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The payoffs to agricultural biotechnology: an assessment of the evidence

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Author Info

  • Marra, Michele C.
  • Pardey, Philip G.
  • Alston, Julian M.

Abstract

Transgenic crops are relatively new technologies being adopted rapidly in the United States and in a few other countries. The economic impacts of these technologies have, thus far, been estimated in a piecemeal fashion. The purpose of this study was to collect and characterize the economic evidence available to date, organize it, and determine if any general implications can be drawn from it. The general classes of economic impacts at the farm level are discussed. The types of studies that generate estimates of these benefits are also characterized and categorized in terms of the implications for measuring economic impacts when the set of things held constant in the type of study does not correspond to those that economic theory suggests. The evidence is presented, along with some general implications drawn from the analysis. These implications are: (1) growing transgenic cotton is likely to result in reduced pesticide use in most years and is likely to be profitable in most years in most U.S. states in the Cotton Belt, 2) Bt corn will provide a small but significant yield increase in most years across the U.S. Corn Belt, and in some years and some places the increase will be substantial, and (3) although there is some evidence of a small yield loss in the Roundup Ready soybean varieties, in most years and locations savings in pesticide costs and, possibly, tillage costs will more than offset the lost revenue from the yield discrepancy. There is not yet enough evidence to generalize even these few conclusions to other countries. More farm- level studies in more years and across more locations are required before any additional implications can be drawn. Studies that measure the non-pecuniary benefits and costs of these technologies should be undertaken, as well.

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Bibliographic Info

Paper provided by International Food Policy Research Institute (IFPRI) in its series EPTD discussion papers with number 87.

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Date of creation: 2002
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Handle: RePEc:fpr:eptddp:87

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Keywords: Transgenic plants.; Technological innovations.; Agricultural research Economic aspects.; Rate of return.; Impact assessment;

References

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  1. Giancarlo Moschini & Harvey Lapan & Andrei Sobolevsky, 2000. "Roundup ready� soybeans and welfare effects in the soybean complex," Agribusiness, John Wiley & Sons, Ltd., vol. 16(1), pages 33-55.
  2. Jose B. Falck-Zepeda & Greg Traxler & Robert G. Nelson, 2000. "Rent creation and distribution from biotechnology innovations: The case of bt cotton and Herbicide-Tolerant soybeans in 1997," Agribusiness, John Wiley & Sons, Ltd., vol. 16(1), pages 21-32.
  3. Pardey, Philip G. & Beintema, Nienke M., 2002. "Slow Magic: Agricultural R&D A Century After Mendel," Working Papers 14364, University of Minnesota, Center for International Food and Agricultural Policy.
  4. Fulton, Murray E. & Keyowski, Lynette, 2000. "The Impact Of Technological Innovation On Producer Returns: The Case Of Genetically Modified Canola," Proceedings:Transitions in Agbiotech: Economics of Strategy and Policy, June 24-25, 1999, Washington, D.C. 25998, Regional Research Project NE-165 Private Strategies, Public Policies, and Food System Performance.
  5. Carl Pray & Danmeng Ma & Jikun Huang & Fangbin Qiao, 2001. "Impact of Bt Cotton in China," CEMA Working Papers 510, China Economics and Management Academy, Central University of Finance and Economics.
  6. Couvillion, Warren C. & Kari, Fatimah & Hudson, Darren & Allen, Albert J., 2000. "A Preliminary Economic Assessment Of Roundup Ready Soybeans In Mississippi," Research reports 15783, Mississippi State University, Department of Agricultural Economics.
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Citations

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Cited by:
  1. Haggblade, Steven, 2007. "Returns to Investment in Agriculture," Food Security Collaborative Policy Briefs 54625, Michigan State University, Department of Agricultural, Food, and Resource Economics.
  2. Eicher, Carl K. & Maredia, Karim & Sithole-Niang, Idah, 2005. "Biotechnology and the African Farmer," Staff Papers 11495, Michigan State University, Department of Agricultural, Food, and Resource Economics.
  3. Kym Anderson & Richard Damania & Lee Ann Jacskon, 2004. "Trade, Standards, and the Political Economy of Genetically Modified Food," Centre for International Economic Studies Working Papers 2004-10, University of Adelaide, Centre for International Economic Studies.
  4. Gouse, Marnus, 2013. "Socioeconomic and farm-level effects of genetically modified crops: The case of Bt crops in South Africa," IFPRI book chapters, in: Falck-Zepeda, Jose Benjamin & Gruère, Guillaume P. & Sithole-Niang, Idah (ed.), Genetically modified crops in Africa: Economic and policy lessons from countries south of the Sahara, chapter 1, pages 25-41 International Food Policy Research Institute (IFPRI).
  5. Antoine Bouet & Guillaume Gruere, 2010. "Refining opportunity cost estimates of not adopting GM cotton : An application in seven sub-saharan african countries," Working Papers hal-00637587, HAL.
  6. Konduru, Srinivasa & Kalaitzandonakes, Nicholas G. & Magnier, Alexandre, 2009. "GMO Testing Strategies and Implications for Trade: A Game Theoretic Approach," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49594, Agricultural and Applied Economics Association.
  7. Nielsen, Chantal Pohl & Robinson, Sherman & Thierfelder, Karen, 2002. "Trade in genetically modified food," TMD discussion papers 106, International Food Policy Research Institute (IFPRI).
  8. Eicher, Carl K. & Maredia, Karim & Sithole-Niang, Idah, 2006. "Crop biotechnology and the African farmer," Food Policy, Elsevier, vol. 31(6), pages 504-527, December.
  9. Onyango, Benjamin M. & Nayga, Rodolfo M., Jr., 2004. "Consumer Acceptance of Nutritionally Enhanced Genetically Modified Food: Relevance of Gene Transfer Technology," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 29(03), December.
  10. Anderson, Kym & Jackson, Lee Ann, 2004. "Implications of genetically modified food technology policies for Sub-Saharan Africa," Policy Research Working Paper Series 3411, The World Bank.
  11. Nielsen, Chantal Pohl & Thierfelder, Karen & Robinson, Sherman, 2003. "Consumer preferences and trade in genetically modified foods," Journal of Policy Modeling, Elsevier, vol. 25(8), pages 777-794, November.
  12. Sebastian, Leocadio & Payumo, Jane G., 1. "NARES Capacity in Relation to International Treaties and Conventions on Intellectual Property Rights, Agricultural Biotechnology, and Plant Genetic Resources Management," Asian Journal of Agriculture and Development, Southeast Asian Regional Center for Graduate Study and Research in Agriculture (SEARCA), vol. 3(1).
  13. Yawson, Robert M. & Yawson, Ivy, 2008. "Policy options of agricultural biotechnology R&D in Sub-Saharan Africa: key issues and aspects," MPRA Paper 34880, University Library of Munich, Germany.
  14. Oliver Musshoff & Norbert Hirschauer, 2011. "A behavioral economic analysis of bounded rationality in farm financing decisions: First empirical evidence," Agricultural Finance Review, Emerald Group Publishing, vol. 71(1), pages 62-83, May.
  15. Gruere, Guillaume P. & Bouet, Antoine & Mevel, Simon, 2007. "Genetically Modified Food and International Trade: The Case of India, Bangladesh, Indonesia and the Philippines," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 9917, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  16. Radhakrishnan, Manju & Islam, Nazrul & Ward, Glynn, 2009. "Measuring the benefits from R&D investment beyond the farm gate: the case of the WA wine industry," 2009 Conference (53rd), February 11-13, 2009, Cairns, Australia 48169, Australian Agricultural and Resource Economics Society.
  17. Joshua D. Detre & Hiroki Uematsu & Ashok K. Mishra, 2011. "The influence of GM crop adoption on the profitability of farms operated by young and beginning farmers," Agricultural Finance Review, Emerald Group Publishing, vol. 71(1), pages 41-61, May.
  18. repec:laf:wpaper:201002 is not listed on IDEAS
  19. Chang, Ching-Cheng & Hsu, Shih-Hsun & Wu, Chia-Hsuan, 2004. "An Economy-Wide Analysis Of Gm Food Labeling Policies In Taiwan," 2004 Annual meeting, August 1-4, Denver, CO 19929, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

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