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The political economy of public research investment and commodity policies in agriculture: an empirical study

  • Swinnen, Johan F. M.
  • Gorter, Harry de
  • Rausser, Gordon C.
  • Banerjee, Anurag N.

The paper tests a political economy theory of simultaneous government decision-making on income redistribution through commodity policies and on public research investment in agriculture. We use data from 37 countries on agricultural protection and public agricultural research expenditures (PARI). The empirical results are consistent with the political economy hypotheses. The analysis suggest that structural changes in the economy have important effects on the political incentives for governments not only to subsidize or tax farmers, but also to invest in public agricultural research. Furthermore, the analysis supports the hypotheses that the impact of such structural changes on government decision-making on PARl is non-linear and conditional on other factors. Regarding the impact of political institutions, the results suggest that more democracy neither leads to more distortionary transfers (agricultural protection), nor to lower investment in public goods (PARI). © 2000 Elsevier Science B.V. All rights reserved.

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Article provided by Blackwell in its journal Agricultural Economics.

Volume (Year): 22 (2000)
Issue (Month): 2 (March)
Pages: 111-122

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Handle: RePEc:eee:agecon:v:22:y:2000:i:2:p:111-122
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  1. Krueger, Anne O & Schiff, Maurice & Valdes, Alberto, 1988. "Agricultural Incentives in Developing Countries: Measuring the Effect of Sectoral and Economywide Policies," World Bank Economic Review, World Bank Group, vol. 2(3), pages 255-71, September.
  2. Rausser, Gordon C., 1992. "Predatory Versus Productive Government: The Case of U.S. Agricultural Policies," Staff General Research Papers 724, Iowa State University, Department of Economics.
  3. Anderson, Jock R. & Pardey, Philip G. & Roseboom, Johannes, 1994. "Sustaining growth in agriculture: a quantitative review of agricultural research investments," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 10(2), April.
  4. William E. Foster & Gordon C. Rausser, 1992. "Price-Distorting Compensation Serving the Consumer and Taxpayer Interest," Food and Agricultural Policy Research Institute (FAPRI) Publications 90-gatt15, Food and Agricultural Policy Research Institute (FAPRI) at Iowa State University.
  5. Beghin, John C. & Foster, William E. & Kherallah, Mylene, 1996. "Institutions and Market Distortions: International Evidence for Tobacco," Staff General Research Papers 1569, Iowa State University, Department of Economics.
  6. Gorter, H. de & Nielson, D. & Rausser, Gordon C., 1992. "Productive and Predatory Public Policies," Staff General Research Papers 732, Iowa State University, Department of Economics.
  7. Johan F.M. Swinnen & Harry de Gorter, 1998. "Endogenous Commodity Policies and the Social Benefits from Public Research Expenditures," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(1), pages 107-115.
  8. Alston, Julian M. & Pardey, Philip G. & Roseboom, Johannes, 1998. "Financing agricultural research: International investment patterns and policy perspectives," World Development, Elsevier, vol. 26(6), pages 1057-1071, June.
  9. John McMillan & Gordon C. Rausser & Stanley R. Johnson, 1993. "Freedoms and Economic Growth: Transitional and Permanent Components," Center for Agricultural and Rural Development (CARD) Publications 93-wp115, Center for Agricultural and Rural Development (CARD) at Iowa State University.
  10. Gardner, Bruce L, 1987. "Causes of U.S. Farm Commodity Programs," Journal of Political Economy, University of Chicago Press, vol. 95(2), pages 290-310, April.
  11. Beghin, John C & Kherallah, Mylene, 1994. "Political Institutions and International Patterns of Agricultural Protection," The Review of Economics and Statistics, MIT Press, vol. 76(3), pages 482-89, August.
  12. Scully, Gerald W, 1988. "The Institutional Framework and Economic Development," Journal of Political Economy, University of Chicago Press, vol. 96(3), pages 652-62, June.
  13. Huffman, Wallace E. & Evenson, Robert E., 2006. "Science for Agriculture: A Long Term Perspective," Staff General Research Papers 12362, Iowa State University, Department of Economics.
  14. Johan F. M. Swinnen & Harry Gorter, 1993. "Why Small Groups And Low Income Sectors Obtain Subsidies: The "Altruistic" Side Of A "Self-Interested" Government," Economics and Politics, Wiley Blackwell, vol. 5(3), pages 285-293, November.
  15. Adam Przeworski & Fernando Limongi, 1993. "Political Regimes and Economic Growth," Journal of Economic Perspectives, American Economic Association, vol. 7(3), pages 51-69, Summer.
  16. Murphy, John A. & Furtan, W. Hartley & Schmitz, Andrew, 1993. "The gains from agricultural research under distorted trade," Journal of Public Economics, Elsevier, vol. 51(2), pages 161-172, June.
  17. Mundlak, Yair, 1978. "On the Pooling of Time Series and Cross Section Data," Econometrica, Econometric Society, vol. 46(1), pages 69-85, January.
  18. de Gorter, Harry & Swinnen, Johan F M, 1998. "Impact of Economic Development on Commodity and Public Research Policies in Agriculture," Review of Development Economics, Wiley Blackwell, vol. 2(1), pages 41-60, February.
  19. Huffman, Wallace & Evenson, Robert E., 1992. "Contributions of Public and Private Science and Technology to U.S. Agricultural Productivity," Staff General Research Papers 10990, Iowa State University, Department of Economics.
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