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Biotech--Who Wins? Economic Benefits and Costs of Biotechnology Innovations in Agriculture

  • Moschini, GianCarlo

The conceptual model necessary for an assessment of biotechnology's economic benefits and costs is outlined, emphasizing the need to account for the proprietary nature of biotechnology innovations. The model is illustrated with an application to Roundup Ready soybeans. The estimated value of this innovation is sizeable, with consumers and innovators claiming the largest shares of net benefits. Also, disparities in intellectual property rights protection across countries affect the distribution of benefits. Consumer resistance toward GMOs and the issue of labelling and market segregation complicate the economic evaluation of biotechnology innovations; a number of related regulation and public policy issues are discussed. Emerging output-trait GMOs are potentially less controversial than some earlier GMOs and may bring more benefits to all participants in the agri-food sector, but this outcome depends crucially on the development of an effective, credible, and internationally harmonized regulatory system.

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Article provided by Estey Centre for Law and Economics in International Trade in its journal Estey Centre Journal of International Law and Trade Policy.

Volume (Year): 02 (2001)
Issue (Month): 1 ()

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Handle: RePEc:ags:ecjilt:23862
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  1. Wesley M Cohen & Richard R Nelson & John P Walsh, 2003. "Protecting Their Intellectual Assets: Appropriability Conditions and Why U.S. Manufacturing Firms Patent (Or Not)," Levine's Working Paper Archive 618897000000000624, David K. Levine.
  2. Kenneth Arrow, 1962. "Economic Welfare and the Allocation of Resources for Invention," NBER Chapters, in: The Rate and Direction of Inventive Activity: Economic and Social Factors, pages 609-626 National Bureau of Economic Research, Inc.
  3. Giancarlo Moschini & Harvey Lapan, 1997. "Intellectual Property Rights and the Welfare Effects of Agricultural R&D," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(4), pages 1229-1242.
  4. Giancarlo Moschini & Harvey Lapan & Andrei Sobolevsky, 2000. "Roundup ready´┐Ż soybeans and welfare effects in the soybean complex," Agribusiness, John Wiley & Sons, Ltd., vol. 16(1), pages 33-55.
  5. Stanley M. Besen & Leo J. Raskind, 1991. "An Introduction to the Law and Economics of Intellectual Property," Journal of Economic Perspectives, American Economic Association, vol. 5(1), pages 3-27, Winter.
  6. 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.
  7. Alston, Julian M. & Wyatt, T. J. & Pardey, Philip G. & Marra, Michele C. & Chan-Kang, Connie, 2000. "A meta-analysis of rates of return to agricultural R & D: ex pede Herculem?," Research reports 113, International Food Policy Research Institute (IFPRI).
  8. Hennessy, David A., 1998. "Microeconomics of Agricultural Grading: Impacts on the Marketing Channel," Staff General Research Papers 1703, Iowa State University, Department of Economics.
  9. Alan Swinbank, 1999. "The role of the WTO and the international agencies in SPS standard setting," Agribusiness, John Wiley & Sons, Ltd., vol. 15(3), pages 323-333.
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