Comparing the Adoption of Genetically Modified Canola in Canada and Australia: The Environmental and Economic Opportunity Costs of Delay

Abstract

This thesis evaluates the opportunity costs of incorporating a socio-economic consideration (SEC) into national regulation on genetically modified (GM) crops. Australia approved the cultivation of GM canola through a science-based risk assessment in 2003, but allowed state moratoria to be instituted on an SEC-based on potential trade impacts over the period 2004 to 2008 and 2010 in the main canola growing states. This analysis constructs a counterfactual assessment, using the Canadian experience to create an S-curve of adoption, to measure the opportunity costs of the SEC-based moratoria through environmental and economic impacts between 2004 and 2014. The impacts will be assessed through a per hectare analysis of canola, by variety, and subsequently aggregated into GM and non-GM variables in New South Wales, Victoria, and Western Australia, and Australia as a whole. These variables, and their respective number of canola hectares are used to create a cumulative impact of the delay from the SEC-based moratoria through comparison of the scenario under the S-curve and the one reflecting the actuality. The environmental impacts will be assessed through the amount of active ingredients applied during pest management, the Environmental Impact Quotient, and greenhouse gas emissions as a by-product of fuel use from the change in machinery passes from cultivation and spray applications. The economic impacts will be measured through the variable costs of the weed control programs, yield, and producer margins, comparing impacts between gross margins, comparative margins, and a calculated contribution margin. The objective of this work is to gain insight into the opportunity cost and impact of incorporating SECs into GM crop regulation.