IDEAS home Printed from
   My bibliography  Save this paper

The Impact of Public and Private R&D on Farmers' Production Decisions: Econometric Evidence for Midwestern States, 1960-2004


  • Huffman, Wallace E.
  • Fan, Xing
  • Schuring, Jessica


The objective of this paper is to identify the impact of public and private agriculturalresearch on multi-output multi-input profit maximizing decisions of Midwestern farmers. The mainhypothesis is that investments in public and private R&D shift outward the supply curves for cropand livestock outputs and, in some cases, reduce the demand for inputs. The study uses stateaggregate data for eight Midwestern states over 1960-2004. The own-price elasticities of demand forall inputs are shown to be negative, being larger for agricultural chemicals and energy that for farmcapital services, labor and other materials. Additional public agricultural research increases thesupply of crop and livestock outputs but biases revenue shares toward crop output. Additionalprivate R&D as in adoption of GM corn varieties shifts outward the supply curves for crops andlivestock outputs but biases revenue shares towards crop output. In contrast, an increase in theadoption of GM soybean varieties increases livestock output and deceases crop output. Publicagricultural research reduces the demand for capital services and energy and increases the demandfor agricultural chemicals, other materials, and labor. An increase in the availability of GM soybeanvarieties increases the demand for capital services, agricultural chemicals and other materials andhas weak negative effects on the demand for labor and energy. GM corn variety adoption reducesthe demand for energy but other effects are quite small.

Suggested Citation

  • Huffman, Wallace E. & Fan, Xing & Schuring, Jessica, 2010. "The Impact of Public and Private R&D on Farmers' Production Decisions: Econometric Evidence for Midwestern States, 1960-2004," Staff General Research Papers Archive 31646, Iowa State University, Department of Economics.
  • Handle: RePEc:isu:genres:31646

    Download full text from publisher

    File URL:
    Download Restriction: no

    More about this item


    Profit function; midwest agriculture; public research; technology; GMOs; multiple-inputs multiple output; crops;

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    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:isu:genres:31646. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Curtis Balmer). General contact details of provider: .

    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.

    We have no references for this item. You can help adding them by using 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.