Understanding the World Wool Market: Trade, Productivity and Grower Incomes. Part 5: Relative Returns to Australian Wool Producers of On- and Off-Farm Research

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Understanding the World Wool Market: Trade, Productivity and Grower Incomes. Part 5: Relative Returns to Australian Wool Producers of On- and Off-Farm Research

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George Verikios (UWA Business School, The University of Western Australia)

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George Verikios

Abstract

This is Chapter 5 of my PhD thesis Understanding the World Wool Market: Trade, Productivity and Grower Incomes, UWA, 2006. The full thesis is available as Discussion Papers 06.19 to 06.24. Here we apply WOOLGEM (the model outlined in Chapter 4) to analyse the effects of on- and off-farm research (and development) leading to productivity improvements in the multistage wool production system. In doing so, we focus on the relative returns to Australian wool producers of on- and off-farm research. The research question is motivated by the continued existence of significant wool industry levies used to fund, inter alia, research at different stages of the Australian wool production system. The levies amount to two per cent of revenue from sales of greasy wool and are used to fund both on and off-farm research (AWIL 2005). For the Australian wool industry, investing the levies on research in the production stage that provides the largest benefit to farmers is crucial for farm profitability in both the short and long term.

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Paper provided by The University of Western Australia, Department of Economics in its series Economics Discussion / Working Papers with number 06-23.

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Length: 62 pages
Date of creation: 2006
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Handle: RePEc:uwa:wpaper:06-23

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This paper has been announced in the following NEP Reports:

NEP-AGR-2007-05-12 (Agricultural Economics)
NEP-ALL-2007-05-12 (All new papers)

References listed on IDEAS
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Julian M. Alston & John W. Freebairn & Jennifer S. James, 2004. "Levy-funded research choices by producers and society," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society and Blackwell Publishing Asia Pty Ltd., vol. 48(1), pages 33-64, 03. [Downloadable!] (restricted)
Martin, Will & Alston, Julian M, 1997. "Producer Surplus without Apology? Evaluating Investments in R&D," The Economic Record, The Economic Society of Australia, vol. 73(221), pages 146-58, June.
Harrison, W Jill & Pearson, K R, 1996. "Computing Solutions for Large General Equilibrium Models Using GEMPACK," Computational Economics, Springer, vol. 9(2), pages 83-127, May.
Other versions:
- W. Jill Harrison & K.R. Pearson, 1994. "Computing Solutions for Large General Equilibrium Models Using GEMPACK," Centre of Policy Studies/IMPACT Centre Working Papers ip-64, Monash University, Centre of Policy Studies/IMPACT Centre. [Downloadable!]
Mullen, J.D. & Alston, J.M. & Wohlgenant, M.K., 1989. "The Impact Of Farm And Processing Research On The Australian Wool Industry," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 33(01), April. [Downloadable!]
Villano, Renato & Fleming, Euan & Farrell, Terence & Fleming, Pauline, 2006. "Productivity Change in the Australian Sheep Industry Revisited," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25593, International Association of Agricultural Economists. [Downloadable!]

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