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Induced Innovation in the High Rainfall Zone

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  • Martin, John F.

Abstract

The induced innovation hypothesis states that the direction of technical change is determined by changes in relative input prices acting as a "spur to invention". To determine the validity of this hypothesis for the High Rainfall Zone of the Australian sheep industry, technical change biases for five input categories were measured using time series data for the period 1952-53 to 1976-77. These biases were then related to relative changes in the price of these input categories. The biases were measured by the application of a translog cost function model and suggested that, in general, technical change has been biased toward the saving of labour and land, the using of livestock, and neutral in regard to capital, and possibly materials and services. Comparison of the ranking of the measured biases with that of the relative price changes indicated that all results, except those for capital, were in general conformity with the induced innovation hypothesis. Finally, the deficiencies of the model and implications of the results are discussed.

Suggested Citation

  • Martin, John F., 1982. "Induced Innovation in the High Rainfall Zone," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 50(03), December.
  • Handle: RePEc:ags:remaae:12522
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    References listed on IDEAS

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    1. McKay, Lloyd & Lawrence, Denis & Vlastuin, Chris, 1982. "Production Flexibility and Technical Change in Australia's Wheat-Sheep Zone," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 50(01), April.
    2. Moses Abramovitz, 1956. "Resource and Output Trends in the United States Since 1870," NBER Chapters,in: Resource and Output Trends in the United States Since 1870, pages 1-23 National Bureau of Economic Research, Inc.
    3. Vincent, David P., 1977. "Factor Substitution In Australian Agriculture," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 21(02), August.
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    5. Lawrence, Denis & McKay, Lloyd, 1980. "Inputs, Outputs And Productivity Change In The Australian Sheep Industry," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 24(01), April.
    6. D. W. Jorgenson & Z. Griliches, 1967. "The Explanation of Productivity Change," Review of Economic Studies, Oxford University Press, vol. 34(3), pages 249-283.
    7. McKay, Lloyd & Lawrence, Denis & Vlastuin, Chris, 1980. "Input Demand and Substitution in the Australian Sheep Industry," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 48(02), August.
    8. A. A. L. Powell, 1969. "Productivity Change In Australia: An Overall View," Economic Papers, The Economic Society of Australia, vol. 1(31), pages 18-34, June.
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    10. McLean, I W, 1973. "Growth and Technological Change in Agriculture: Victoria 1870-1910," The Economic Record, The Economic Society of Australia, vol. 49(128), pages 560-574, December.
    11. Peter B. Dixon & David P. Vincent & Alan A. Powell, 1976. "Factor Demand and Product Supply Relations in Australian Agriculture : The CRESH/CRETH Production System," Centre of Policy Studies/IMPACT Centre Working Papers op-08, Victoria University, Centre of Policy Studies/IMPACT Centre.
    12. Kennedy, Charles & Thirlwall, A P, 1972. "Technical Progress: A Survey," Economic Journal, Royal Economic Society, vol. 82(325), pages 11-72, March.
    13. te Kloot, Jack H. & Anderson, Jock R., 1977. "Estimation Of Technological Change In The Pastoral Zone," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 45(04), December.
    14. Gutman, G.O., 1955. "Investment and Production in Australian Agriculture," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 23(04), December.
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