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Abstract

Consumers are increasingly interested in farming methods and the nutritional quality of food. Manufacturers, in turn, are adding more information to food labels. In 1990, Congress passed two watershed laws on food labeling, one requiring nutrition labels to be included on most processed foods and the other requiring organic foods to meet a national uniform standard. This report examines the economic issues involved in five labels for which the Federal Government has played different roles in securing the information and making it transparent to consumers. In addition to the nutrition and organic labels, the report scrutinizes three other labels—one advertising foods made without genetically engineered ingredients, another advertising products made from animals raised without antibiotics, and the Federal country-of-origin label, which is now required for fresh and frozen fruits and vegetables, some nuts, fish and shellfish, ginseng, and certain meats. As interest grows in process-based and other types of food labeling, findings from these five case studies illustrate the economic effects and tradeoffs in setting product standards, verifying claims, and enforcing truthfulness.

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