Consumer Perceptions of Labels and the Willingness to Pay for “Second Generation” Genetically Modified Products

Environmental and consumer groups have called for mandatory labeling of genetically modified (GM) food products in the United States, stating that consumers have the “right to know.” But evidence exists suggesting that consumers often cannot correctly interpret the meaning of scientific labels. Herein we use a nonhypothetical field experiment to examine how well consumers interpret GM labels, focusing on the solitary secondgeneration GM product currently on the U.S. market—GM cigarettes. Our results suggest that while consumers pay less for GM cigarettes when they are labeled as GM, these labels seem to be misinforming consumers. This evidence implies that consumers could be better off without mandatory GM labeling.