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Productivity growth and the returns from public investment in R&D in Australian broadacre agriculture

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  • Mullen, John D.

Abstract

Investment in R&D has long been regarded as an important source of productivity growth in Australian agriculture. Perhaps because research lags are long, current investment in R&D is monitored closely. Investment in R&D has been flat while productivity growth has remained strong, relative both to other sectors of the Australian economy and to the agricultural sectors of other countries. Such productivity growth, at a time when the decline in terms of trade facing Australian farmers has slowed, may have enhanced the competitiveness of Australian agriculture. The econometric results presented here suggest no evidence of a decline in the returns from research from the 15 to 40 per cent per annum range estimated by Mullen and Cox. In fact the marginal impact of research increases with research over the range of investment levels experienced from 1953 to 2000, a finding which lends support to the view that there is underinvestment in agricultural research. These results were obtained from econometric models which maintain strong assumptions about how investments in research and extension translate into changes in TFP. Hence some caution in interpreting the results is warranted.

Suggested Citation

  • 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), December.
  • Handle: RePEc:ags:aareaj:118518
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    File URL: http://purl.umn.edu/118518
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    References listed on IDEAS

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    1. Christopher O’Donnell & Robert Chambers & John Quiggin, 2010. "Efficiency analysis in the presence of uncertainty," Journal of Productivity Analysis, Springer, vol. 33(1), pages 1-17, February.
    2. Mullen, John D. & Cox, Thomas L., 1996. "Measuring Productivity Growth In Australian Broadacre Agriculture," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 40(03), December.
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    6. Grant M. Scobie & John D. Mullen & Julian M. Alston, 1991. "The Returns To Investment In Research On Australian Wool Production," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 35(2), pages 179-195, August.
    7. Pannell, David J., 1999. "On the balance between strategic-basic and applied agricultural research," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 43(1), March.
    8. Dean Parham, 2004. "Sources of Australia's Productivity Revival," The Economic Record, The Economic Society of Australia, vol. 80(249), pages 239-257, June.
    9. Cox, Thomas L. & Mullen, John D. & Hu, Wensheng, 1997. "Nonparametric measures of the impact of public research expenditures on Australian broadacre agriculture," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 41(3), September.
    10. Mullen, John D. & Cox, Thomas L., 1995. "The Returns From Research In Australian Broadacre Agriculture," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 39(02), August.
    11. Albert K. A. Acquaye & Julian M. Alston & Philip G. Pardey, 2003. "Post-War Productivity Patterns in U.S. Agriculture: Influences of Aggregation Procedures in a State-Level Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(1), pages 59-80.
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    Citations

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    Cited by:

    1. Sanderson, Todd & Ahmadi-Esfahani, Fredoun Z., 2010. "Climate change and Australia’s comparative advantage in broadacre agriculture," 2010 Conference, August 26-27, 2010, Nelson, New Zealand 96493, New Zealand Agricultural and Resource Economics Society.
    2. Bryce Stewart & Terrence Veeman & James Unterschultz, 2009. "Crops and Livestock Productivity Growth in the Prairies: The Impacts of Technical Change and Scale," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 57(3), pages 379-394, September.
    3. Jean-Paul Chavas, 2008. "On the economics of agricultural production ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 52(4), pages 365-380, December.
    4. Sabasi, Darlington & Shumway, C. Richard, 2014. "Technical Change, Efficiency, and Total Factor Productivity in U.S. Agriculture," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170225, Agricultural and Applied Economics Association.
    5. Tozer, Peter R. & Villano, Renato, 2013. "Decomposing Productivity and Efficiency among Western Australian Grain Producers," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 38(3), December.
    6. Nisrane, Fantu & Berhane, Guush & Asrat, Sinafikeh & Getachew, Gerawork & Taffesse, Alemayehu Seyoum & Hoddinott, John F., 2011. "Sources of inefficiency and growth in agricultural output in subsistence agriculture: A stochastic frontier analysis," ESSP working papers 19, International Food Policy Research Institute (IFPRI).
    7. 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, Melbourne School of Land and Environment, vol. 21.
    8. David Colman, 2010. "Agriculture's terms of trade: issues and implications," Agricultural Economics, International Association of Agricultural Economists, vol. 41(s1), pages 1-15, November.
    9. Rajabrata Banerjee & Martin Shanahan, 2016. "The Contribution of Wheat to Australian Agriculture from 1861 to 1939," Australian Economic History Review, Economic History Society of Australia and New Zealand, vol. 56(2), pages 125-150, July.
    10. Nasir nadeem, Dr. & khalid Mushtaq, Dr., 2010. "Role of Agricultural Research and Extension in Enhancing Agricultural Productivity in Punjab, Pakistan," MPRA Paper 27769, University Library of Munich, Germany.
    11. Ada Ignaciuk & Daniel Mason-D'Croz, 2014. "Modelling Adaptation to Climate Change in Agriculture," OECD Food, Agriculture and Fisheries Papers 70, OECD Publishing.
    12. repec:spr:climat:v:143:y:2017:i:3:d:10.1007_s10584-017-2013-1 is not listed on IDEAS
    13. Todd Sanderson & Fredoun Z. Ahmadi - Esfahani, 2009. "Testing Comparative Advantage in Australian Broadacre Agriculture Under Climate Change: Theoretical and Empirical Models," Economic Papers, The Economic Society of Australia, vol. 28(4), pages 346-354, December.

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