Landscape Clubs: Co-existence of Genetically Modified and Organic Crops

The possibility of increased production of genetically modified (GM) crops in agriculture accentuates the need to examine the feasibility of GM and non-GM technologies co-existing on a common physical landscape. Using the theory of clubs, this paper examines the possibility of co-existence for GM and organic wheat technologies through the formation of an organic club with an endogenously determined buffer zone. Given the available data on prices, and yields, it is shown that a club can be created in which GM and organic agricultural production technologies can economically co-exist in the same physical landscape. Specifically, co-existence results in an increase in economic welfare over a situation where only GM technology is used but is not Pareto superior because producers in the buffer zone will incur injury. We show that organic producers in the club can compensate producers in the buffer zone and still be better off. Hence, the compensation principle holds. La possibilite de production accrue de cultures genetiquement modifiees (GM) accentue la necessite d'examiner la faisabilite de coexistence des technologies GM et non GM dans un meme paysage agricole. A l'aide de la theorie des clubs, le present article a examine la possibilite de coexistence des technologies de culture de ble GM et de ble biologique en creant un club ≪biologique≫ comprenant une zone tampon determinee de facon endogene. Compte tenu des donnees disponibles concernant les prix et les rendements, il est montre qu'il est possible de creer un club au sein duquel les technologies de production de cultures biologiques et GM peuvent economiquement coexister dans un meme paysage naturel. Specifiquement, la coexistence engendre une augmentation du bien-etre economique par rapport a une situation ou seule la technologie GM est utilisee, mais elle n'est pas Pareto superieure parce que les producteurs dans la zone tampon subiront des dommages. Nous montrons que les producteurs de cultures biologiques membres du club peuvent indemniser les producteurs de la zone tampon tout en demeurant en bonne position. Le principe de compensation tient donc.