Can paste food coloring be substituted for liquid food color in baking?

Yes, you can. Just remember that food coloring paste is a lot thicker than liquid food color so you use a lot less. Start with just a tiny bit on the end of a spoon and add more in tiny amounts as necessary.

Usually 1/2 teaspoon of gel paste is equal to about 1.5 oz of liquid food (to put it into perspective - a shot and a half of liquid) colouring