IDEAS home Printed from https://ideas.repec.org/a/wly/agribz/v19y2003i3p355-366.html
   My bibliography  Save this article

Who bears the burden and who receives the gain?-The case of GWRDC R&D investments in the Australian grape and wine industry

Author

Listed:
  • Xueyan Zhao

    (Department of Econometrics & Business Statistics, Monash University, Clayton, VIC 3800, Australia. E-mail: xueyan.zhao@buseco.monash.edu.au)

Abstract

It is only when R&D levies are invested in the sectors in which they are raised that the distribution of the benefits among industry sectors is exactly the same as the incidence of the levies. This article examines the distributions of both costs and returns from the Australian grape and wine R&D investments and the divergence between the two distributions. The real shares of R&D costs are estimated through the incidence of the levies and compared with the nominal shares. Grape-growers, winemakers and overseas consumers are shown to receive bigger proportions of gains than their proportions of costs, while the Australian government and other domestic parties as a group bear a much higher proportion of costs than returns. This article discusses implications of results for the equity issue between premium and nonpremium producers, the free-rider issue for overseas consumers, and the justification of government funding of grape and wine R&D. [EconLit citations: Q16, Q18, and H43]. © 2003 Wiley Periodicals, Inc. Agribusiness 19: 355-366, 2003.

Suggested Citation

  • Xueyan Zhao, 2003. "Who bears the burden and who receives the gain?-The case of GWRDC R&D investments in the Australian grape and wine industry," Agribusiness, John Wiley & Sons, Ltd., vol. 19(3), pages 355-366.
    • Handle: RePEc:wly:agribz:v:19:y:2003:i:3:p:355-366
    DOI: 10.1002/agr.10065
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1002/agr.10065
    File Function: Link to full text; subscription required
    Download Restriction: no
    File URL: https://libkey.io/10.1002/agr.10065?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Zhao, Xueyan & Mullen, John D. & Griffith, Garry R. & Griffiths, William E. & Piggott, Roley R., 2000. "An Equilibrium Displacement Model of the Australian Beef Industry," Research Reports 28007, New South Wales Department of Primary Industries Research Economists.
    2. Xueyan Zhao & Kym Anderson & Glyn Wittwer, 2019. "Who Gains from Australian Generic Wine Promotion and R&D?," World Scientific Book Chapters, in: Kym Anderson (ed.), The International Economics of Wine, chapter 9, pages 189-223, World Scientific Publishing Co. Pte. Ltd..
    3. Xueyan Zhao & Kym Anderson & Glyn Wittwer, 2002. "Who Gains from Australian Generic Wine R&D and Promotion?," Centre for International Economic Studies Working Papers 2002-04, University of Adelaide, Centre for International Economic Studies.
    4. Findlay, Christopher C & Jones, Robert L, 1982. "The Marginal Cost of Australian Income Taxation," The Economic Record, The Economic Society of Australia, vol. 58(162), pages 253-262, September.
    5. Christopher C. Findlay & Robert L. Jones, 1982. "The Marginal Cost of Australian Income Taxation," The Economic Record, The Economic Society of Australia, vol. 58(3), pages 253-262, September.
    6. J. M. Alston & J. D. Mullen, 1992. "Economic Effects Of Research Into Traded Goods: The Case Of Australian Wool," Journal of Agricultural Economics, Wiley Blackwell, vol. 43(2), pages 268-278, May.
    7. Zhao, Xueyan & Mullen, John D. & Griffith, Garry R., 2005. "Economic Surplus Measurement in Multi-Market Models," Working Papers 12910, University of New England, School of Economics.
    8. Glyn Wittwer & Nick Berger & Kym Anderson, 2019. "A Model of the World’s Wine Markets," World Scientific Book Chapters, in: Kym Anderson (ed.), The International Economics of Wine, chapter 1, pages 3-26, World Scientific Publishing Co. Pte. Ltd..
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alston, Julian M. & Freebairn, John W. & James, Jennifer S., 2004. "Levy-funded research choices by producers and society," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 48(1), pages 1-32.
    2. Horridge, Mark & Madden, John & Wittwer, Glyn, 2005. "The impact of the 2002-2003 drought on Australia," Journal of Policy Modeling, Elsevier, vol. 27(3), pages 285-308, April.
    3. Xueyan Zhao & Kym Anderson & Glyn Wittwer, 2019. "Who Gains from Australian Generic Wine Promotion and R&D?," World Scientific Book Chapters, in: Kym Anderson (ed.), The International Economics of Wine, chapter 9, pages 189-223, World Scientific Publishing Co. Pte. Ltd..
    4. Xayavong, Vilaphonh & Radhakrishnan, Manju & Kingwell, Ross S., 2013. "Development Strategies for a Premium Wine Region of Australia: an application of value chain modelling," 2013 Conference (57th), February 5-8, 2013, Sydney, Australia 152186, Australian Agricultural and Resource Economics Society.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Benjamin Henderson & Lynn Henry & Gordon MacAulay & Jen Tatuh, 2010. "Potential Payoff from R&D in the Coconut Industry of North Sulawesi, Indonesia," Asian Economic Journal, East Asian Economic Association, vol. 24(1), pages 69-85, March.
    2. Xayavong, Vilaphonh & Radhakrishnan, Manju & Kingwell, Ross S., 2013. "Development Strategies for a Premium Wine Region of Australia: an application of value chain modelling," 2013 Conference (57th), February 5-8, 2013, Sydney, Australia 152186, Australian Agricultural and Resource Economics Society.
    3. Mounter, Stuart W. & Griffith, Garry R. & Piggott, Roley R. & Mullen, John D., 2005. "The Relative Payoffs From R&D and Generic Advertising Expenditure by the Australian Pig Industry," Working Papers 12943, University of New England, School of Economics.
    4. Auriol, Emmanuelle & Warlters, Michael, 2012. "The marginal cost of public funds and tax reform in Africa," Journal of Development Economics, Elsevier, vol. 97(1), pages 58-72.
    5. Dent, Siobahn K. & Piggott, Roley R. & O'Donnell, Christopher J. & Griffith, Garry R., 2003. "Does Excluding Cross-commodity Interactions Matter? Beef and Lamb in Australia," 2003 Conference (47th), February 12-14, 2003, Fremantle, Australia 57859, Australian Agricultural and Resource Economics Society.
    6. Alston, Julian M. & Smith, Vincent H. & Acquaye, Albert & Hosseini, Safdar, 1999. "Least-cost cheap-food policies: some implications of international food aid," Agricultural Economics, Blackwell, vol. 20(3), pages 191-201, May.
    7. Mickaël Beaud & Thierry Blayac & Patrice Bougette & Soufiane Khoudmi & Philippe Mahenc & Stéphane Mussard, 2013. "Estimation du coût d'opportunité des fonds publics pour l'économie française," Working Papers halshs-01077141, HAL.
    8. baharumshah, ahmad, 1992. "Income Redistribution Through Commodity Programmes and the Marginal Welfare Cost of Taxation," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 25(June), pages 47-61.
    9. Chris Jones, 2005. "Why the Marginal Social Cost of Funds is not the Shadow Value of Government Revenue," ANU Working Papers in Economics and Econometrics 2005-449, Australian National University, College of Business and Economics, School of Economics.
    10. Xueyan Zhao & Kym Anderson & Glyn Wittwer, 2019. "Who Gains from Australian Generic Wine Promotion and R&D?," World Scientific Book Chapters, in: Kym Anderson (ed.), The International Economics of Wine, chapter 9, pages 189-223, World Scientific Publishing Co. Pte. Ltd..
    11. Warlters, Michael & Auriol, Emmanuelle, 2005. "The marginal cost of public funds in Africa," Policy Research Working Paper Series 3679, The World Bank.
    12. Ambarawati, I Gusti Agung Ayu & Zhao, Xueyan & Griffith, Garry R. & Piggott, Roley R., 2003. "Distribution of Gains from Cattle Development in a Multi-Stage Production System: The Case of the Bali Beef Industry," 2003 Conference (47th), February 12-14, 2003, Fremantle, Australia 57829, Australian Agricultural and Resource Economics Society.
    13. Lana Awada & Peter W. B. Phillips, 2021. "The distribution of returns from land efficiency improvement in multistage production systems," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 69(1), pages 73-92, March.
    14. X. Zhao & J.D. Mullen & G.R. Griffith & R.R. Piggott & W.E. Griffiths, 2002. "The Economic Incidence of R&D and Promotion Investments in the Australian Beef Industry," Monash Econometrics and Business Statistics Working Papers 16/02, Monash University, Department of Econometrics and Business Statistics.
    15. Henderson, Benjamin B. & Henry, Lynn A. & MacAulay, T. Gordon, 2006. "Investment and Change in the Coconut Industry of North Sulawesi: An Equilibrium Displacement Analysis," 2006 Conference (50th), February 8-10, 2006, Sydney, Australia 139789, Australian Agricultural and Resource Economics Society.
    16. Marina Farr & Natalie Stoeckl & Rabiul Alam Beg, 2011. "The efficiency of the Environmental Management Charge in the Cairns management area of the Great Barrier Reef Marine Park," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 55(3), pages 322-341, July.
    17. Rathnayake, Chinthani & Griffith, Garry & Sinnett, Alexandria & Malcolm, Bill & Farquharson, Bob, 2023. "Developing an Equilibrium Displacement Model of the Sri Lankan Tea Industry," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 31(2), April.
    18. Mounter, Stuart W. & Griffith, Garry R. & Piggott, Roley R., 2004. "The Payoff from Generic Advertising by the Australian Pig Industry in the Presence of Trade," Working Papers 12946, University of New England, School of Economics.
    19. Peter Tisato, 1997. "User Economies of Scale: Bus Subsidy in Adelaide," The Economic Record, The Economic Society of Australia, vol. 73(223), pages 329-347, December.
    20. Mounter, Stuart W. & Griffith, Garry R. & Piggott, Roley R. & Fleming, Euan M. & Zhao, Xueyan, 2008. "An Equilibrium Displacement Model of the Australian Sheep and Wool Industries," Research Reports 37663, New South Wales Department of Primary Industries Research Economists.

    More about this item

    JEL classification:

    • Q16 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - R&D; Agricultural Technology; Biofuels; Agricultural Extension Services
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • D60 - Microeconomics - - Welfare Economics - - - General
    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
    • C69 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Other

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:agribz:v:19:y:2003:i:3:p:355-366. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1520-6297 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.