IDEAS home Printed from https://ideas.repec.org/a/ags/auagre/292474.html
   My bibliography  Save this article

Measuring the Returns to Investment in RD&E in the WA Grains Industry Using Equilibrium Displacement Modelling

Author

Listed:
  • Li, Kuo
  • Kingwell, Ross
  • Griffith, Garry
  • Malcolm, Bill

Abstract

Equilibrium Displacement Models (EDMs) are useful for estimating the net benefits of investments in agricultural research, development and extension (RD&E) and the distribution of these benefits between producers and other participants in the value chain. Information from these models can inform investment decisions by funders of RD&E. In this paper the design and construction of an EDM for the Western Australian grains industry, a major component of the national grains industry, is reported. Using the EDM, two RD&E investment scenarios are examined. The first scenario is for a 1 per cent reduction in the cost of farm production inputs as a result of an investment in RD&E, while the second scenario involved a 1 per cent increase in the willingness of overseas consumers to pay for wheat as a result of an investment in RD&E. The results show that the farm sector and overseas consumers are the major beneficiaries under each scenario. The WA grains industry is characterised by a short supply chain, where most grain production is exported. The large volume of grain exported means that, if there is an increase in demand or supply, some of the total benefits go to consumers overseas. Still, a high price elasticity of demand for export grains ensures that the farm production sector receives the majority of total benefits, and that these benefits outweigh the share of benefits received by overseas consumers.

Suggested Citation

  • Li, Kuo & Kingwell, Ross & Griffith, Garry & Malcolm, Bill, 2019. "Measuring the Returns to Investment in RD&E in the WA Grains Industry Using Equilibrium Displacement Modelling," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 27(4).
    • Handle: RePEc:ags:auagre:292474
    DOI: 10.22004/ag.econ.292474
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/292474/files/AAR-Vol-27-Paper-4-Li-et-al.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.292474?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Li, Kuo & Malcolm, Bill & Griffith, Garry & Kingwell, Ross, 2022. "A Model of the Southern Australian Grains Industry," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 30(2), April.
    2. Sarah Rohr & Stuart Mounter & Derek Baker, 2024. "Implications for Economic Sustainability of Food Systems from Reductions in Household Food Waste: The Case of the Australian Apple Industry," Sustainability, MDPI, vol. 16(3), pages 1-14, January.
    3. 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.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:auagre:292474. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: http://www.agrifood.info/review/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.