Regulation of Technology in the Context of Risk Generation

Abstract

This chapter uses a generic model of the risk-generating process and an approach to accommodating uncertainty about risk to draw some inferences about regulating transgenic crops. The analysis suggests that regulation should concentrate on reducing uncertainty about environmental impacts of transgenic crops. Thus, it may be cost effective for the United States to de-emphasize restrictions on planting but expand post-commercialization monitoring. The analysis also indicates that there are tractable ways of incorporating firms’ and consumers’ reactions to regulation into models of the risk-generation process. The main impediment to doing so is a lack of empirical models, which suggests a need for empirical work aimed at producing results that can be extrapolated to biotechnology regulation. The model can be extended easily to accommodate multiple, heterogeneous sites.