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How Did We Go? Revisiting the Ex Ante Economic Impact Assessment of the CRC for Beef Genetic Technologies, as at the Cessation of Funding

Author

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  • Griffith, G.R.
  • Pollock, K.S.
  • Burrow, H.M.

Abstract

The Cooperative Research Centre (CRC) for Beef Genetic Technologies operated for its third successive 7-year term from July 2005 to June 2012. It targeted an additional 1.5 per cent in gross revenue of the Australian beef industry over 25 years to 2030. This was to be achieved by developing a package of new genetic and genomic technologies and non-genetic “products” (practices, processes, tools and technologies) to improve profitability, productivity, animal welfare and responsible resource use of Australian beef businesses. The economic analyses underpinning the 2004 business case for the CRC’s third term were published by Griffith et al. (2005) and Griffith (2009). In re-assessing the original estimates of economic benefit as at the end of the CRC investment phase, the most prominent issues to consider were the potential total productivity growth available to the beef and cattle industries as a result of CRC technologies, how each research program contributed to the overall productivity gain, the level of adoption of the technologies by industry and the time lag of this adoption. This paper has reviewed the impact of adjusting these variables on the total economic benefit of the CRC to the Australian beef and cattle industry, given information available in June 2012. A reduction in potential productivity gains (due primarily to slower-than-anticipated delivery of new genomic technologies that also impacted on industry adoption times) had the largest impact on benefit to industry, followed by a reduction in the expected maximum level of adoption. Research program components of growth, R&D lags and adoption lags had more marginal impacts. Whilst the estimated economic benefits of the Beef CRC to industry varies substantially according to the mix of assumptions used relating to the key parameters, even under the most adverse scenario the Beef CRC is still expected to generate a total benefit to the industry of $784 million, which is more than 50 per cent higher than the “without-CRC” scenario ($516 million). The most likely scenario delivers an expected industry benefit of $1,004 million, which is almost twice that of the “without-CRC” scenario, and provides a return on investment of more than $8 for every $1 invested into the Beef CRC.

Suggested Citation

  • Griffith, G.R. & Pollock, K.S. & Burrow, H.M., 2013. "How Did We Go? Revisiting the Ex Ante Economic Impact Assessment of the CRC for Beef Genetic Technologies, as at the Cessation of Funding," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 21, pages 1-18.
    • Handle: RePEc:ags:auagre:206166
    DOI: 10.22004/ag.econ.206166
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    References listed on IDEAS

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    1. Mullen, John D., 2007. "Productivity Growth and the Returns from Public Investment in R&D in Australian Broadacre Agriculture," 2007 Conference (51st), February 13-16, 2007, Queenstown, New Zealand 9451, Australian Agricultural and Resource Economics Society.
    2. Zhao, Xueyan & Griffiths, William E. & Griffith, Garry R. & Mullen, John D., 2000. "Probability distributions for economic surplus changes: the case of technical change in the Australian wool industry," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 44(1), pages 1-24.
    3. Parnell, Peter F. & Clark, Richard A. & Timms, Janice & Griffith, Garry R. & Hyland, Paul W. & Mulholland, Cynthia & Alford, Andrew R., 2008. "Targets, Implementation Issues and Achievements to 2007/08," AFBM Journal, Australasian Farm Business Management Network, vol. 5(1-2), pages 1-11.
    4. Griffith, Garry R. & Parnell, Peter F. & McKiernan, William A., 2005. "The Economic, Environmental and Social Benefits to NSW from Investment in the CRC for Beef Genetics Technologies," Research Reports 42654, New South Wales Department of Primary Industries Research Economists.
    5. Mullen, John D., 2007. "Productivity growth and the returns from public investment in R&D in Australian broadacre agriculture," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 51(4), pages 1-26.
    6. Griffith, Garry R., 2009. "Estimating the economic impact of a major beef industry research and development investment," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 17, pages 1-24.
    7. Farquharson, Robert J. & Griffith, Garry R. & Barwick, Steve & Banks, Rob & Holmes, Bill, 2003. "Estimating the Returns from Past Investment into Beef Cattle Genetic Technologies in Australia," Research Reports 28009, New South Wales Department of Primary Industries Research Economists.
    8. John Mullen, 2007. "Productivity growth and the returns from public investment in R&D in Australian broadacre agriculture," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 51(4), pages 359-384, December.
    9. Guthrie, Graeme, 2009. "Real Options in Theory and Practice," OUP Catalogue, Oxford University Press, number 9780195380637.
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    2. Lana Awada & Peter W. B. Phillips, 2021. "The distribution of returns from land efficiency improvement in multistage production systems," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 69(1), pages 73-92, March.

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