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Returns to New Technologies in the Australian Beef Industry: On-farm Research versus Off-farm Research

Author

Listed:
  • Zhao, Xueyan
  • Griffith, Garry R.
  • Mullen, John D.

Abstract

A multi-sectoral and multi-market model of the Australian beef industry is specified using an equilibrium displacement modelling framework. The model is implemented using average price and quantity data for the period 1991-1997 and market parameter values taken from the literature, derived from theoretical restrictions or from the authors’ subjective judgement. Total returns and the distributions among various industry groups from alternate R&D and promotion investments, which result in 1% shifts in the relevant supply or demand curves, are examined. In this paper, the implications for farmers from various on-farm R&D investments (genetic research and nutrition research in backgrounding cattle for grain-finishing and in grass-finishing) and off-farm R&D investments (nutrition research for grain-finishing, research for meat processing, and research for domestic and export marketing activities) are compared and contrasted. The results indicate that in general, on-farm research produces a larger share of total benefits to farmers than off-farm research. Comparison of the actual monetary returns from the different investment scenarios depends on the relative costs of achieving the 1% supply shifts.

Suggested Citation

  • Zhao, Xueyan & Griffith, Garry R. & Mullen, John D., 2000. "Returns to New Technologies in the Australian Beef Industry: On-farm Research versus Off-farm Research," 2000 Conference (44th), January 23-25, 2000, Sydney, Australia 123749, Australian Agricultural and Resource Economics Society.
  • Handle: RePEc:ags:aare00:123749
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    References listed on IDEAS

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    1. J. W. Freebairn & J. S. Davis & G. W. Edwards, 1983. "Distribution of Research Gains in Multistage Production Systems: Reply," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 65(2), pages 357-359.
    2. George C. Davis & Maria Cristina Espinoza, 1998. "A Unified Approach to Sensitivity Analysis in Equilibrium Displacement Models," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(4), pages 868-879.
    3. Zhao, Xueyan & Griffiths, William E. & Griffith, Garry R. & Mullen, John D., 2000. "Probability distributions for economic surplus changes: the case of technical change in the Australian wool industry," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 44(1), March.
    4. Xueyan Zhao & John D. Mullen & Gary R. Griffith, 1997. "Functional Forms, Exogenous Shifts, and Economic Surplus Changes," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(4), pages 1243-1251.
    5. J. M. Alston & G. M. Scobie, 1983. "Distribution of Research Gains in Multistage Production Systems: Comment," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 65(2), pages 353-356.
    6. William Griffiths & Xueyan Zhao, 2000. "A Unified Approach to Sensitivity Analysis in Equilibrium Displacement Models: Comment," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(1), pages 236-240.
    7. Grant M. Scobie & John D. Mullen & Julian M. Alston, 1991. "The Returns To Investment In Research On Australian Wool Production," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 35(2), pages 179-195, August.
    8. John D. Mullen & Thomas L. Cox, 1995. "The Returns From Research In Australian Broadacre Agriculture," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 39(2), pages 105-128, August.
    9. Cox, Thomas L. & Mullen, John D. & Hu, Wensheng, 1997. "Nonparametric measures of the impact of public research expenditures on Australian broadacre agriculture," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 41(3), September.
    10. J. W. Freebairn & J. S. Davis & G. W. Edwards, 1982. "Distribution of Research Gains in Multistage Production Systems," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 64(1), pages 39-46.
    11. Mullen, John D. & Cox, Thomas L., 1995. "The Returns From Research In Australian Broadacre Agriculture," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 39(02), August.
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    Citations

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    Cited by:

    1. 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.
    2. Griffith, Garry R. & Malcolm, Bill & Mounter, Stuart W. & Slattery, Henry, 2010. "Old model, new problem: when should you update a model and what happens when you do?," Australasian Agribusiness Review, University of Melbourne, Melbourne School of Land and Environment, vol. 18.
    3. Mounter, Stuart W. & Griffith, Garry R. & Piggott, Roley R., 2005. "The Payoff from Generic Advertising by the Australian Pig Industry in the Presence of Trade," Australasian Agribusiness Review, University of Melbourne, Melbourne School of Land and Environment, vol. 13.
    4. Liu, Esther & Tarrant, Katherine A. & Ho, Christie K.M. & Malcolm, Bill & Griffith, Garry R., 2012. "Size and Distribution of Research Benefits in the Australian Dairy Industry," 2012 Conference (56th), February 7-10, 2012, Freemantle, Australia 124326, Australian Agricultural and Resource Economics Society.
    5. 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.
    6. 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.
    7. 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.
    8. Griffith, Garry R. & Rodgers, Heidi & Thompson, John M. & Dart, Cameron, 2009. "The aggregate economic benefits to 2007/08 from the adoption of meat standards Australia," Australasian Agribusiness Review, University of Melbourne, Melbourne School of Land and Environment, vol. 17.
    9. Bullock, David S. & Salhofer, Klaus, 2003. "Judging agricultural policies: a survey," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 28(3), May.
    10. Griffith, Garry R. & Thompson, John M., 2012. "The aggregate economic benefits to the Australian beef industry from the adoption of meat standards Australia: updated to 2010/11," Australasian Agribusiness Review, University of Melbourne, Melbourne School of Land and Environment, vol. 20.

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