Agricultural economics: The underrated benefits of GM crops

By: Matin Qaim

Department of Agricultural Economics and Rural Development, Georg-August University of Goettingen,
37073 Goettingen, Germany; Email: mqaim@uni-goettingen.de

When you ask people in Europe what they think of genetically modified (GM) crops, the majority has a negative opinion, inspired by a mixture of environmental, health, social, and ethical concerns. Whenever somebody mentions possible benefits, there are knee-jerk reactions suggesting that these benefits are only industry propaganda. I have experienced this frequently as an agricultural economist who has looked into the socioeconomic effects of GM crops for more than 15 years. Anti-biotech groups regularly criticize studies that show advantages of GM crops  as suffering from data problems, methodological flaws, or other types of biases. Such criticism may often be unsubstantiated, but when reiterated frequently it causes wider suspicion, entrenching the notion of a corporate conspiracy to promote GM crops to the detriment of farmers, consumers, and the environment.

It was against this background that Wilhelm Klümper and I decided to conduct a meta-analysis of the original studies that had analyzed the impact of GM crops around the world. A meta-analysis can help consolidate the evidence and also identify possible sources of bias. Our meta-analysis was published in PLOS ONE in early November 2014 (http://dx.plos.org/10.1371/journal.pone.0111629). The study received some media attention, with several large newspapers and internet blogs reporting about the results. I have provided a short summary of what we found.

Original studies for inclusion in the meta-analysis were identified through keyword searches in relevant literature databanks. We included all studies with primary data on agronomic and economic impacts of GM crops at the farm or plot level anywhere in the world that were written in the English language. We limited the scope to the most important GM crops available so far, including herbicide-tolerant (HT) soybean, maize, and cotton, as well as insect-resistant (IR) maize and cotton. (GM crops with several other traits are being developed, but are not yet widely available.)

One decision we had to make was whether to only include published journal articles or also studies from the grey literature, such as working papers or reports by various types of organizations. We eventually decided to include the grey literature as well, in order to avoid possible publication bias (if studies with insignificant or negative results were not accepted for publication in a journal, including only journal articles might lead to overestimated benefits). In total, we included 147 original studies.

Mean results from these 147 studies suggest that GM technology has increased crop yields by 21%. These yield increases are not due to higher genetic yield potential, but to more effective pest control and thus lower crop damage. At the same time, GM crops have reduced chemical pesticide quantity by 37% and pesticide cost by 39%. The effect on the cost of production is not significant. GM seeds are more expensive than non-GM seeds, but the additional seed costs are compensated through savings in chemical and mechanical pest control. Average profit gains for GM-adopting farmers are 68%.

Summary results in Table 1 also show a breakdown by type of technology. While significant reductions in pesticide costs are observed for both HT and IR crops, only IR crops lead to a consistent reduction in pesticide quantity. Such disparities are expected, because the two technologies are quite different. IR crops protect themselves against certain insect pests, so that spraying can be reduced. HT crops, on the other hand, are not protected against pests but against a broad-spectrum chemical herbicide (mostly glyphosate), use of which facilitates weed control. While HT crops have reduced herbicide quantity in some situations, they have contributed to increases in the use of broad-spectrum herbicides elsewhere. The savings in pesticide costs for HT crops in spite of higher quantities can be explained by the fact that broad-spectrum herbicides are often much cheaper than the selective herbicides that were used before. The average farmer profit effect for HT crops is large and positive, but not statistically significant because of considerable variation and a relatively small number of observations for this outcome variable.

In addition to mean impacts, we used meta-regressions to analyze what factors influence impact heterogeneity. The results of these meta-regressions confirm that yield gains and pesticide-reducing effects of IR crops are higher than those of HT crops. Furthermore, yield and profit gains of GM crops are significantly higher for farmers in developing countries than in developed countries. Especially smallholder farmers in the tropics and subtropics suffer from considerable pest damage that can be reduced through GM crop adoption. Moreover, most GM crops are not patented in developing countries, so that GM seed prices are lower there.

The meta-regressions also revealed that the type of funding for a study does not influence the study results. Most original studies were funded by the public sector, but the few studies that were sponsored by industry money did not report systematically higher benefits. We also examined whether the type of publication matters. Studies that were published in peer-reviewed journals report somewhat higher benefits than other studies on average. However, further analysis showed that this is not due to publication bias. Peer-reviewed articles in our sample report a wide range of effects, including negative ones, which indicates that low impacts are not a reason for manuscripts to not get published in a journal. The reason for the systematic difference between journal articles and grey literature is rather that the grey literature studies include a few reports by environmental NGOs and outspoken biotechnology critics. These reports portray low or negative GM effects, but not all meet common scientific standards.

In summary, our meta-analysis confirms that the average agronomic and economic benefits of GM crops are large and significant. This robust evidence of GM crop benefits might help to gradually increase public trust in this technology. I am not naïve; one meta-analysis is not going to change the public debate about GM crops completely. But scientific evidence still has an important role to play for dispelling widespread misconceptions.

I declare no conflict of interest. All of my research on GM crop impacts was always independent and entirely funded by the public sector.

Table 1. Mean impacts of GM crop adoption (in %)

**, *** statistically significant at 5% and 1% level, respectively.