Vol. 75 No. 2 (2020)
Saggi e Ricerche

EU border rejections of unauthorized GM food and the trade deflection effects

Dannyra Tatiana Mendoza Cuello
Department of demography - State University of Campinas, Brazil
Rosane Nunes de Faria
Department of Economics - Federal University of Sao Carlos, Brazil
Adelson Martins Figueiredo
Department of Economics - Federal University of Sao Carlos, Brazil
Heloisa Lee Burnquist
Department of Economics, Administration and Sociology Luiz de Queiroz – College of Agriculture University of Sao Paulo, Brazil
Published September 24, 2020
Keywords
  • border rejections,
  • GM food,
  • trade deflection,
  • European Union,
  • third market
How to Cite
Mendoza Cuello, D. T., de Faria, R. N., Figueiredo, A. M., & Burnquist, H. L. (2020). EU border rejections of unauthorized GM food and the trade deflection effects. Italian Review of Agricultural Economics, 75(2), 65-76. https://doi.org/10.13128/rea-12070

Abstract

We identify that consignments rejected by the European Union, due to the presence of unauthorized Genetically Modified food, have been diverted to third countries, creating trade deflections. We rely on a gravity model to examine the effects on food products. Our results show that the rejection of shipments by the EU has a side-effect on the global trade flows in the form of trade deflection, which can overcome losses related to A.A. The deflection occurs largely for products whose major importers have already approved most of the GM events rejected by the EU and with very concentrated export market. We also found that exporting countries with higher border rejections tend to increase their trade deflections, providing a deeper understanding of the effects of A.A on global trade flows.

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