Foods produced using biotechnology: how does the law protect consumers?

This paper addresses the following subjects: biotechnology and consumers, concern about risks, consumer acceptance, labelling of foods produced using biotechnology, the legal approach to consumer protection, and consumer protection policies relating to biotechnology products in the European Union, the United States, Turkey and global institutions such as the Convention for Biological Diversity (CBD) and the World Trade Organisation (WTO). It is likely that biotechnology will gain ground much more rapidly in the twenty‐first century than in the past. Despite rapid, detailed and precise advances in gene technology, its applications have not been the received with a great deal of consumer enthusiasm. Consumers have approached genetically modified foods with considerable apprehension and opposition. Consumer concerns about bioengineered food products focus on the questions of human health, environmental and social risks and benefits. The most important stages in the process of marketing new foods produced using biotechnology are to demonstrate user need and consumer acceptance. Generally, the technical complexity of biotechnology makes it difficult for consumers to understand details of the product and the specific attributes of biotechnology applications. Scientific uncertainty, the nature of consumer concerns and general reluctance to accept biotechnology products, increase the importance of consumer protection. Legal protection is a very important factor in the solution of new social problems related to technological advances. More specifically, consumer and environmental law support consumer protection related to foods produced with biotechnology. The basic principles of consumer law can be re‐formulated as consumer rights. Environmental law is a new phenomenon, but precautionary principles and public participation in decision‐making for environmental law are relevant to consumer protection relating to bioengineered food products.     

Factors Affecting Food Label Complexity: Does the New EU Regulation Satisfy Consumer Issues? An Exploratory Study

There is still a substantial information asymmetry between producers and consumers. Despite the recent EU regulation on labeling to enhance consumer food safety and the existence of a number of certifications on sustainable food products, there remain blind spots in the widely debated consumer information issue. Our study, conducted on primary data processed with a probit model, was aimed at identifying the factors that may affect consumer response in relation to difficulties in interpreting the labels of processed food products. Starting from theoretical models, several factors held responsible for defining the consumer’s knowledge were used as explanatory variables. Our results show that despite changes in the new legislation, there remains the problem of the consumer’s lack of knowledge concerning environmental labeling and product certification.     

The Environmental Commitment of Consumer Organizations in Denmark, the United Kingdom, The Netherlands, and Belgium

Consumer organizations have traditionally been concerned with protecting, informing, and educating the "weak" consumers. These policies were deemed necessary because of the unequal power balance and conflicts of interests between consumers and producers. Since there are also conflicts between the interests of nature on the one hand, and consumers and producers on the other, this article discusses the rationale of consumer organizations' involvement in environmental issues while considering their original objectives. More specifically, it is aimed at identifying the commitment of several European consumer organizations with respect to environmental issues during the past two decades in order to assess whether and how environmental issues are internalized in consumer policy across time.     

Errare humanum est: Financial Literacy in European Consumer Credit Law

Examples of financial mistakes made by consumers lend support to the view that systematic mistakes of consumers exist in the EU credit market and that service providers respond strategically to these by redesigning their products. This paper seeks to determine how existing regulation can be improved to ensure consumer protection. Using insights from behavioural economics, this paper argues that financial literacy??that is, knowledge and understanding of complex financial products and skills to navigate the financial market??as a cornerstone for European financial consumer law is problematic. Current regulation is based primarily on information provision to consumers, which should enable them to make appropriate decisions about the risks and suitability of financial products. Although behavioural economics does not necessarily require legal intervention to take other forms than the introduction of information duties, the type of intervention is dependent on the design and needs of a particular market. The EU consumer credit market, in our view, demands more than the current regulation offers in terms of consumer protection. In particular, behavioural studies reveal that consumers generally do not have a sufficient level of financial literacy in order to enable them to make informed, rational decisions. Moreover, behavioural biases have a distorting influence on consumer decision making. The law as it stands, therefore, seems ill-equipped to offer protection to consumers and to prevent them from rash and bad decision making. Reviewing existing regulation and case law, we propose that in the EU law, the Consumer Credit Directive and the Markets in Financial Instruments Directive require updating in order to offer sufficient protection to vulnerable groups of consumers who, on average, have low levels of financial literacy.     

Alternative Regulatory Cases Challenging Consumer Policy

By means of the concept of postmodern politics, we provide insights into how alternative regulation is challenging consumer policy. New actors, new forms of interaction, and new goals are emerging alongside established forms of consumer policy. In particular, we examine two alternative regulatory cases: trust marks and consumer-generated information systems. They both exemplify alternative regulation of electronic commerce, which has facilitated regulatory innovation for over a decade. On the basis of our analysis, we suggest that governmental consumer policy cannot imitate the alternative regulatory solutions. We also encourage governmental actors to consider building bridges to consumer networks. This would broaden the scope of consumer policy and be in line with the modes of operation of governmental actors. Consumers are themselves contributing to this rethinking of governmental consumer policy. By networking, consumers provide each other with empowering information on consumption. Doing so on the massive scale enabled by information and communication technologies, they are challenging conventional consumer policy, which can no longer address consumer needs as it could in the pre-Internet days. New issues are emerging for consumer policy to address, and networked consumers are already contributing to policy.     

Financial literacy education and behaviour unhinged: combating bias and poor product design

The growth of products available in the consumer financial market has provided more choice and formal control over household financial decisions than ever before. Financial literacy education programs are generally assumed to improve consumer behaviour in relation to financial products and services. However, there is scant evidence that demonstrates the causal link between education, literacy and behaviour. Through the use of a sample study, we show that the actions of individuals who are financially literate do not necessarily mean they will demonstrate good financial behaviour. We propose that in order to improve the financial behaviour of consumers, two critical areas need to be addressed. Firstly, the objectives of financial literacy programs should be not only to educate consumers about financial markets and products but highlight to individuals the psychological biases and limitations that they as humans cannot easily avoid. Secondly, the regulation of financial products sold to consumers needs alteration to meet the aim of protecting retail consumers from complex financial products that are confusing, ambiguous and inappropriate. We propose regulation and redesign of product information offerings using techniques employed in ecological interface design models to derive a suitability test for consumer financial products.     

Effects of online communication practices on consumer perceptions of performance uncertainty for search and experience goods

The “intangible” nature of e-commerce may cause shoppers to be uncertain about whether products ordered online will fit their needs or perform up to expectations. Such uncertainty is a dimension of consumer risk, or feelings that result because the actual outcome of a purchase decision can only be known in the future. However, the ability of e-retailers to offer a plethora of product-related information can ameliorate this uncertainty. This research assesses the influence of three online retailer communication practices—evoking vividness through pictures, allowing consumers to control information presentation, and presenting information from third-party sources. We demonstrate that these practices materially affect consumer perceptions of product performance uncertainty. Importantly, we also find that the influence of the practices differs by the search or experience orientation of the product, sometimes in counterintuitive ways. These results can serve to help enhance the effectiveness of e-retailers’ communications and, in the case of multichannel retailers, help determine which products are best suited for different channels.     

Consumers and Biotechnology: A Synopsis of Survey and Focus Group Research

The Office of Consumer Affairs of Industry Canada, in conjunction with other federal departments, has undertaken preliminary work to identify concerns and highlight consumer issues with respect to biotechnology and its applications. This has included conducting a number of surveys and focus groups to identify what consumers know about biotechnology; where there are information gaps; and how information impacts upon consumers' purchasing decisions.This paper is structured into five sections. First, it provides an overview of some background information on biotechnology. The second section summarises consumers' knowledge of, and reactions to, biotechnology. Next, the paper highlights factors that influence consumers' attitudes towards biotechnology. The fourth section examines two ways of overcoming marketplace barriers contrasting increased consumer awareness with more traditional legislative mechanisms. The concluding section outlines questions that need to be answered in order to determine how the marketplace can best address issues related to biotechnological products.     

Mapping the consumer‐subject in advertising

Traditionally marketing communication‐or more specifically advertising‐has been framed in terms of products/ services, needs and wants of consumers as if these were real givens, existing independently of the forms and acts of marketing communication itself. From this perspective, advertising is merely seen as a purveyor of information about products/services/needs between producers and consumers but hardly as actively implicated in shaping, not only the relation between the processes of production and those of consumption, but also the conception of the consumer‐subject. This paper makes a brief diachronic account of advertising with a view to highlighting how the consumer‐subject is represented. Whereas early advertising conceives of the consumer‐subject as a “rational” decision‐maker, aware of its needs and desire, more recent advertising constitutes the consumer‐subject in a hyperreal, dream‐like world, which seduces and spellbinds it.     

Experience,change and vulnerability: consumer education for older people revisited

Everyday consumer transactions have the same potential for unexpected consequence whatever the age of the consumers involved. Young and old alike can find that products and services fail to live up to performance claims and that they are left with problems not easily resolved, or costs that are difficult to recover. While not overlooking consumer heterogeneity – especially on the basis of age – older consumers are arguably distinguishable in terms of the social and financial context in which they make decisions and attempt to redress problems. In 1988, attention was drawn to the need for consumer education to look beyond generic objectives to the specific situation of older people and their transactions. More than a decade later, in an allegedly consumer‐oriented society, the issue is revisited here to assess the argument's current relevance. Despite the increased availability of information for decisions and consumer protection, difficulties persist in the way information is presented or accessed. Chameleon‐like, old problems become manifest in new unfamiliar ways and invalidate experience. Consumer education today is as important as it was in 1988. Arguably, technological change means that the need for a better understanding of dangers, rights and redress procedures is greater than ever and the needs of older people in increasingly complex private and public sector transaction environments are all the more pressing. However, a fundamental revision of the way we approach the design of products, services and environments is needed to improve prospects for older consumers.     

Zielsetzungen und Instrumentarien der europäischen Verbraucherrechtspolitik: Eine Analyse von Entwicklungen im Bereich des Zivilrechts

Objectives and instruments of European consumer policy: An analysis of developments in the area of civil law. The paper discusses the relationships and conflicts between the objectives pursued by European consumer policy and the means which are at its disposal. As a first step, the theoretical assumptions of this policy are analysed by an evaluation of the EC Programme for a Consumer Protection and Information Policy of 1975 and of the draft directives on product liability, on misleading and unfair competition, on doorstep sales, and on correspondence courses. It is suggested that the European approach toward consumer protection largely corresponds to the policies prevailing at the national level: Consumer protection is seen as a supplement to the traditional market and competition policy which used to be restricted to regulating competition between producers or suppliers of goods and services, whereas the new policy focuses on the relations between producers and consumers. Nevertheless, consumer policy adheres to the basic presumptions of market economy. It presupposes that the demands of the consumer have to be articulated and satisfied via market processes. It therefore primarily relies on regulations directed against misleading advertising, on protecting justified expectations as to the quality of goods or services by providing redress for losses sustained, and by endeavours aimed at securing a more rational behaviour of the individual consumer. The most important means to promote this policy on the European level are the directives which aim at consonance among national laws (Art. 100 EC Treaty). This is indicative of a market orientation of consumer policy in so far as the harmonization of law is seen as a device for overcoming discriminating effects or distortions of competition created by the differences among national laws thereby furthering a better functioning of the Common Market (Art. 3 h EC Treaty). This accordance of consumer policy and harmonization policy does not rest on firm ground, however. In consumer policy it becomes more and more obvious that the efforts to protect the interests of the consumer lead to further interventionist activities. This process also reveals the need for systematic adjustments or consultations between consumer policy and other fields of politics. A harmonization policy which is primarily centered on breaking down trade barriers and on overcoming discriminating effects of competition cannot respond to the needs and problems of such interventionist activities. Therefore, the harmonization of consumer law should be conceived as a process of formulating broader policies directed at a congruous development of the economic sphere and at an improvement of the living conditions in the Common Market (cf. Art. 2 and the preamble of the EC Treaty). Legal techniques which might be adopted to support such an orientation are (a) in the EC directives to lay down minimum standards for the national legislation, (b) to use a conflict-of-laws approach which would allow to respect and try to coordinate legitimate interests in the application of national consumer policies, and (c) the development of special rules responding to the international aspects of the exchange between producers and consumers. At present, however, European policy gives hardly any attention to the chances and problems of such an approach requiring a complicated coordination of the various legal techniques.     

Consumer Preferences for Food Label Information: A Basis for Segmentation

Analysis of consumer reactions to food labeling alternatives using conjoint measurement raises questions concerning policy proposals to provide consumers with information. Conjoint measurement permits analysis of components of consumer perceptions without tedious data collection and analysis procedures. The study indicates that consumer preferences for information vary widely and an optimal policy should provide different labels for different market segments. Increasing the amount of information may reduce its effectiveness among the low income consumers it is intended to help.     

Product attributes and consumer acceptance of nutritionally enhanced genetically modified foods

Using data from a national survey, this study analyses US consumers’ acceptance of genetically modified foods that provide additional nutritional benefits. Using an ordered probit model, this study examines the relation between the willingness to consume genetically modified foods and consumers’ economic, demographic and value attributes. Empirical results suggest that despite having some reservations, especially about the use of biotechnology in animals, American consumers are not decidedly opposed to food biotechnology. Consumers’ economic and demographic variables are only weakly related to their acceptance of food biotechnology, especially when technology involves plant‐to‐plant DNA transfer. However, public trust and confidence in various private and public institutions are significantly related to their acceptance of food biotechnology. Overall, consumer acceptance of bioengineered foods is driven primarily by public perceptions of risks, benefits and safety of these food products.     

A Problem Ignored: Dilution and Negation of Consumer Information by Antifactual Content

Current conceptions of consumer information do not consider types that may dilute or detract from facts available to consumers about products and services. The article discusses the nature and incidence of such antifactual content, identifies research and public policy that ignores the content but could benefit from recognizing it, and describes a role for the content in conceptualizing and better assessing consumer information, in order to provide researchers, regulators, advertisers, and consumers with more accurate evaluations.     

Use of persuasive techniques on Internet shopping sites

Huge strides in technological development combined with marketing strategies have led to dramatic changes in the way information is transmitted and communicated to the consumers, and subsequently used by the consumers. Information has become a dominant factor in determining why, where, what, and how consumers shop, process information, and make decisions. While marketing information has always been an important factor in consumer decision‐making, its provision on demand and added convenience via the Internet has created a need to research the nature and amount of information that these technologies provide. Advertisements use different forms of persuasion to gain consumer attention, meet their economic and emotional shopping needs, to create a positive image of the product, brand, and the shopping medium, and influence consumers to purchase the product. Persuasion may be classified as functional congruity and self‐congruity routes to persuasion (Johar & Sirgy, 1991). Fifty websites were studied for utilitarian and value‐expressive forms of persuasion by product differentiation. The websites were classified as those selling tangible products only and those selling intangible products only, and those selling both tangible and intangible products. The paper will present results of the study along with a discussion and conclusion with implications on consumer well‐being.     

Marketing tactics discouraging price search: Deception and competition

Retailers attempt to assure consumers that their deals are bargains using a variety of marketing tactics. Because consumers continue information and price searches until satisfied with the amount of the information to make a purchase, such bargain assurances (BAs) can change consumers' shopping behavior. This article identifies twelve common BAs and reviews extant marketing literature to derive evidence of how BAs affect consumers' purchasing behavior. It then examines how these practices are regulated to prevent consumer deception or a reduction in competition. This article concludes by offering three policy recommendations: BAs influence consumers and require regulation; the regulation of BAs demands a comprehensive rather than a piecemeal approach; and consumer policy should facilitate and encourage accurate price comparisons.     

Factors influencing the search for information about genetically modified food products

A recent application of biotechnology to food is genetic modification. Genetically modified (GM) plants, animals and processed foods have been introduced to the international marketplace in the 1990s. As scientific and technological progress in modern biotechnology continues at a breakthrough pace, the consumers are presented with different types and levels of information that is potentially relevant for making choices. Findings from studies of consumer attitudes and awareness towards GM products have varied greatly. Many studies, however, have indicated that public opinions about GM products are not fully formed and the task of informing the public is far from over. This study expands on previous research by examining the factors that influence the search for information about GM products. Utilizing the theory of consumer behaviour and information search, we analyse consumers’ information search patterns about GM products. Specifically, we estimate the probability that consumers search for information actively, passively or do not search for information at all, and the factors influencing this search. An ordered probit model is formulated to measure the factors, both economic and behavioural, that influence in‐formation search by consumers for GM products. Variables representing the informational attitudes and behaviour related to GM products have the greatest impact on the probability of searching for information about GM products. With the exception of age, demographic factors are not significant. The results point to information search, not, for the genetically modified characteristic, but instead for the absence of the characteristic.     

A review of the ‘consumer interest’ in organic meat

The study aims to provide a critical review of the literature on the consumer interest in the UK in organic food, with a particular focus on organic meat. Given that people are more likely to purchase products if they have faith in them, the regulation of organic food standards is reviewed to explore issues affecting consumers. This is followed by a review of the organic meat sector. Aspects of the consumer interest considered in this paper include consumer information, consumer access, consumer safety, consumer choice and consumer representation. As the literature on organic food/meat in the UK is extensive, it was therefore necessary to be selective with regard to the publications suitable for this review. Most of the literature selected for this paper has been drawn from UK publications, although several European and international sources have also been used. The review found that there is a considerable level of interest in the UK organic meat sector. As the regulation of organic food produced is set at varying standards across the European Union, this could lead to consumers being misled regarding the quality of products offered. It was also found that, although consumers perceive organic foods as healthier, more nutritious and tasting better than non‐organic products, the literature shows that this may have only a limited basis on fact. Contamination of organic products with pesticides and even genetically modified ingredients is always possible. Organic farmers are permitted to use other ingredients in organic meat products that may be harmful to health. Escherichia coli and Salmonella risks associated with conventional meat also appear to affect organic meat. Consumers need clear, accurate and reliable information about organic meat. They also need to be provided with safe products, a choice of organic products, access to organic products and to be represented effectively.     

To be respected or liked: The influence of social comparisons on consumer preference for competence- versus warmth-oriented products

Consumers frequently compare themselves with others and find themselves to be inferior or superior to the comparison targets. This article examines the effect of social comparisons on the relative focus of self-efficacy and relationship needs and the subsequent impact on consumers’ preference for competence- versus warmth-oriented products. Across six studies, we show that upward comparisons (i.e., comparisons with superior targets) result in feelings of self-threat, which heighten the need for self-efficacy and increase the preference for products that convey competence. In contrast, downward comparisons (i.e., comparisons with inferior targets) elicit feelings of social distress, which heighten the need for social relationships and increase the preference for products that convey warmth. These effects are mitigated when the comparison is made in a social skill-related domain and when the comparison target is an out-group member.     

Consumer Support Networks: assessment of need for consumer information and advice service

Research evidence suggests that UK consumers are facing significant problems with goods and services and are in need of information and advice to avoid or redress such situations. Consumers are not always aware of their rights nor where they can access consumer advice services. In 2000, the Department of Trade and Industry launched the Consumer Support Network (CSN) programme in Great Britain to improve consumer access to expert, accurate and timely advice. One challenge faced by these Networks and many other agencies is to assess the needs of consumers for consumer information and advice services. A needs assessment is required as a key element in the effective planning and development of services in each Network at a local level. The focus of the needs assessment at the local level is to encourage Networks to consider suitable solutions to meet the needs of people in their communities. This paper provides a review of the development of Consumer Support Networks in Great Britain and discusses the importance of needs assessment to service providers such as CSNs and other agencies. It reveals the complexity associated with conducting effective needs assessments including the various aspects of needs, consumer segmentation and characteristics of consumer information and advice. Further research is being carried out at Queen Margaret University College, UK, with a view to the development of a scientific model for the assessment of need for consumer information and advice services.