The Impact of Agricultural Biotechnology on Supply and Land-Use
AbstractIncreased demand for agricultural produce for food, fiber, feed, and energy generates a tradeoff between high prices and environmentally costly land conversion. Genetically engineered (GE) seeds can potentially increase supply without recruiting new lands to production. We develop a simple adoption model to show how first-generation GE increases yield per hectare. We identify yield increases from cross country time series variation in GE adoption share within the main GE crops- cotton, corn, and soybeans. We find that GE increased yields 34% for cotton, 32% for corn, but only 2% for soybeans. The model also predicts that GE extends the range of lands that can be farmed profitably. If the output on these lands are attributed to GE technology, then overall supply effects are larger than previously understood. Considering this extensive margin effect, the supply effect of GE increases from 10% to 16% for corn, 15% to 20% for cotton, and 2% to 39% for soybeans, generating significant downward pressure on prices. Finally, we compute \saved" lands and greenhouse gasses as the difference between observed hectarage per crop and counterfactual hectarage needed to generate the same output without the yield boost from GE. We find that all together, GE saved 21million Ha of land from conversion to agriculture in 2010, or 0.41 Gt ofCO2emissions (using a constantCO2/land conversion factor). These averted emissions are equivalent to roughly 1/3 the annual emissions from driving in the US.
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Bibliographic InfoPaper provided by Department of Agricultural & Resource Economics, UC Berkeley in its series Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series with number qt3rg0c0fz.
Date of creation: 14 Jun 2013
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Social and Behavioral Sciences; genetic engineering; ge seeds; co2 emissions;
Other versions of this item:
- Barrows, Geoffrey & Sexton, Steven & Zilberman, David, 2013. "The Impact of Agricultural Biotechnology on Supply and Land-Use," CUDARE Working Paper Series 1133, University of California at Berkeley, Department of Agricultural and Resource Economics and Policy.
- NEP-AGR-2013-07-28 (Agricultural Economics)
- NEP-ALL-2013-07-28 (All new papers)
- NEP-ENV-2013-07-28 (Environmental Economics)
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