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Economic Issues for Plant Breeding - Public Funding and Private Ownership

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  • Lindner, Robert K.

Abstract

The world of plant breeding is changing rapidly in response both to scientific developments and to economic forces. In particular, there is a growing trend to widespread privatisation of crop breeding. An economist's perspective on some of the key differences between traditional public plant breeding and private plant breeding will be presented together with some of the key driving forces behind the emerging trend to privatisation of plant breeding. A possible consequence of much greater private involvement in Australian plant breeding is the crowding-out of all other competition by a very small number of large multi-national firms, who might then exploit their market power to capture almost all of the value created by plant breeding. Australian grain growers have already demonstrate a willingness to fund local plant breeding firms to forestall such a threat, and to ensure ongoing access to locally bred varieties that maintain Australia's competitive advantage in international grain markets. Another threat is the risk that government and grower support of pre-breeding research will decline without any compensating investment by the private sector. As this type of research provides the foundation for ongoing long-term variety improvement and productivity gains, eventually private investment in plant breeding may stall as a result. Alternatively there may be wasteful duplication and/or inefficient utilisation of such related R&D as firms strive for competitive advantage in the market place. In any event, the access regime for both public and private plant breeders to output from all government and/or collective industry funded research and other generic services will be an important policy issue. Some of the principles under-pinning National Competition Policy will be reviewed as a possible basis for the formulation of an appropriate policy.

Suggested Citation

  • Lindner, Robert K., 2004. "Economic Issues for Plant Breeding - Public Funding and Private Ownership," Australasian Agribusiness Review, University of Melbourne, Melbourne School of Land and Environment, vol. 0.
  • Handle: RePEc:ags:auagre:132081
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    File URL: http://ageconsearch.umn.edu/record/132081/files/Lindner%20-%20Paper%206.pdf
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    References listed on IDEAS

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    1. Brennan, Geoffrey & Walsh, Cliff, 1981. "A Monopoly Model of Public Goods Provision: The Uniform Pricing Case," American Economic Review, American Economic Association, vol. 71(1), pages 196-206, March.
    2. Fuglie, Keith O. & Klotz-Ingram, Cassandra & Gill, Mohinder, 1996. "Intellectual Property Rights Encourage Private Investment in Plant Breeding," Choices: The Magazine of Food, Farm, and Resource Issues, Agricultural and Applied Economics Association, vol. 0(Issue 1), pages 1-2.
    3. Thirtle, Colin G. & Srinivasan, Chittur S. & Heisey, Paul W., 2001. "Public Sector Plant Breeding In A Privatizing World," Agricultural Information Bulletins 33775, United States Department of Agriculture, Economic Research Service.
    4. Lindner, Robert K., 2004. "Privatised provision of essential plant breeding infrastructure," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 0(Issue 2), pages 1-21.
    5. Godden, David P., 1982. "Plant Variety Rights in Australia: Some Economic Issues," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 0(Number 01), pages 1-45, April.
    6. Thirtle, C. & Bottomley, P. & Palladino, P. & Schimmelpfennig, D. & Townsend, R., 1998. "The rise and fall of public sector plant breeding in the United Kingdom: a causal chain model of basic and applied research and diffusion," Agricultural Economics, Blackwell, vol. 19(1-2), pages 127-143, September.
    7. Burns, Michael E & Walsh, Cliff, 1981. "Market Provision of Price-excludable Public Goods: A General Analysis," Journal of Political Economy, University of Chicago Press, vol. 89(1), pages 166-191, February.
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    Cited by:

    1. Beard, Rodney, 2008. "End-Point versus Point of Sale Levying of Plant Breeding Royalties: An Economic Analysis using Optimal Control Theory," MPRA Paper 7178, University Library of Munich, Germany.

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