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The Effect of Innovation on Agricultural and Agri-food Exports in OECD Countries

  • Ghazalian, Pascal L.
  • Furtan, William Hartley

This paper investigates the effect of innovation on primary agricultural and processed food product exports among the Organization for Economic Cooperation and Development (OECD) countries. A theoretical gravity equation that accounts for innovation is derived. The empirical exercise uses panel data sets covering 21 OECD countries for the period 1990-2003. The R&D capital stock is employed as a tangible way of measuring innovation. Empirical results show that R&D has enhanced exports in the primary agricultural sector. Meanwhile, the market expansion effect of R&D appears to be more than offset by the market power effect in the food processing sector, resulting in a decrease in exports. Also, evidence was found of a positive vertical channeling effect through which R&D in the primary agricultural sector increases exports of processed food products.

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File URL: http://purl.umn.edu/7075
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Article provided by Western Agricultural Economics Association in its journal Journal of Agricultural and Resource Economics.

Volume (Year): 32 (2007)
Issue (Month): 03 (December)
Pages:

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Handle: RePEc:ags:jlaare:7075
Contact details of provider: Web page: http://waeaonline.org/

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