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Pricing Of Bt Cotton Seeds In India: The Debate Behind

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  • ARORA, Anchal

Abstract

In 2006 the state government of Andhra Pradesh reduced the Bt cotton seed prices from Indian Rs1600 to Rs750 in order to make the technology affordable and accessible to small and marginal farmers in the state and also to prevent the monopolistic market structure in the seed market. The drastic reduction in seed prices, on the other hand could affect the profitability of seed providing companies and curb their incentives to innovate in future. Recent literature has also examined the impact of price controls on diffusion of technology, revenue and profitability of seed providers. It suggests that price controls have positively impacted the diffusion of technology in India, and were also successful in increasing the revenue of seed providers in the short run. However, the impact of price controls on profitability would depend on cost conditions. In the light of the above discussion, this article attempts to discuss the debate behind price controls and draws certain policy implications pertaining to pricing of Bt seeds, which has an international policy relevance.

Suggested Citation

  • ARORA, Anchal, 2014. "Pricing Of Bt Cotton Seeds In India: The Debate Behind," Review of Agricultural and Applied Economics (RAAE), Faculty of Economics and Management, Slovak Agricultural University in Nitra, vol. 17(2), pages 1-4, November.
    • Handle: RePEc:ags:roaaec:196626
    DOI: 10.22004/ag.econ.196626
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    References listed on IDEAS

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    1. Matin Qaim & Alain de Janvry, 2003. "Genetically Modified Crops, Corporate Pricing Strategies, and Farmers' Adoption: The Case of Bt Cotton in Argentina," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(4), pages 814-828.
    2. Anchal Arora & Sangeeta Bansal, 2012. "Diffusion of Bt Cotton in India: Impact of Seed Prices and Varietal Approval," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 34(1), pages 102-118.
    3. Matin Qaim, 2009. "The Economics of Genetically Modified Crops," Annual Review of Resource Economics, Annual Reviews, vol. 1(1), pages 665-694, September.
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    5. N. Lalitha & Carl E. Pray & Bharat Ramaswami, 2008. "The Limits of intellectual property rights: Lessons from the spread of illegal transgenic seeds in India," Discussion Papers 08-06, Indian Statistical Institute, Delhi.
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