Greg Traxler

Surplus Distribution from the Introduction of a Biotechnology Innovation

We examine the distribution of welfare from the introduction of Bt cotton in the United States in 1996. The welfare framework explicitly recognizes that research protected by intellectual property rights generates monopoly profits, and makes it possible to partition these rents among consumers, farmers, and the innovating input firms. We calculate a total increase in world surplus of

A Joint-Product Analysis of the Adoption of Modern Cereal Varieties in Developing Countries

240.3 million for 1996. Of this total, the largest share (59%) went to U.S. farmers. The gene developer, Monsanto, received the next largest share (21%), followed by U.S. consumers (9%), the rest of the world (6%), and the germplasm supplier, Delta and Pine Land Company (5%).

Economic Returns to Crop Management Research in a Post-Green Revolution Setting

Semi-dwarf wheat varieties have been slow to diffuse in some regions despite their superior grain yield. We analyze varietal differences in yields of the joint products of grain and straw, the decision to adopt new varieties, and nitrogen demand. The low straw yield of semi-dwarf varieties under low input conditions is shown to be a plausible explanation for their slow adoption in some regions. First generation modern varieties induced a large increase in the derived demand for nitrogen, but subsequent varietal development appears to have had little impact on nitrogen demand.

Transgenic Cotton in Mexico: A Case Study of the Comarca Lagunera

Returns to research studies have neglected research on crop management (CMR), which may account for half of all crop research. Because CMR enhances the efficiency of input use, returns to CMR are hypothesized to increase in settings characterized by high input levels and high yields. A method is developed to estimate returns to CMR, and this method is applied to wheat research in a post-green revolution setting in northwest Mexico. The results suggest that returns to CMR are positive over a range of model assumptions.

Valuing Pre-Commercial Genetic Resources: A Maximum Entropy Approach

In 1999, transgenic cotton was grown in six countries on a total of some 3.7 million hectares, making it the world’s third most common transgenic crop (Table 10.1). Bt cotton has been grown in Mexico since 1996 and was planted on one third of the country’s cotton area during the 2000 growing season. A number of papers have now been published on the impacts of transgenic crops in the United States, but few empirical studies of transgenic crops in developing countries have appeared. In this paper we describe Mexico’s experience with Bt cotton, focusing on the “Comarca Lagunera” region in the northern states of Coahuila and Durango, where Bt adoption reached 96% within three years of its introduction in 1997.

The GMO experience in North and South America

Genetic improvement has been a major contributor to agricultural productivity in the United States, but many questions about the economics of crop breeding, such as the value of pre-commercial germplasm, remain unanswered. This study estimates the marginal value of poorly characterized materials contained in the U.S. national germplasm system. Within the search theoretic framework, we apply a maximum entropy method to estimate the probability and the expected level of improvement in pest susceptibility relative to its best previously observed level. The results indicate that the lower-bound estimate of benefit is significantly higher than the upper-bound cost of conserving an accession. Copyright 2003, Oxford University Press.

Cotton GMO Adoption and Private Profitability

This paper surveys the level and distribution of economic impacts of GMOs in the Americas from 1996-2004. Key institutional factors influencing GMO diffusion are discussed. In 2004 the Americas accounted for 94%, of world GMO area. Diffusion has been concentrated; four countries, four crops and two traits account for the vast majority of area. The economic benefits of the diffusion of GMOs have been widely shared among farmers, industry, and consumers even though delivery has been through the private sector. GMOs have had a favourable environmental impact by facilitating reduced pesticide use and adoption of conservation tillage.

Consequences of Biotechnology Policy for Competitiveness and Trade of Southern U.S. Agriculture

Publisher Summary This chapter reviews the economic benefits and costs of Bt cotton, with detailed analysis of rent creation and distribution in 1996 and 1997, by using survey data. It provides the preliminary surplus estimates for Bt cotton in 1998 and then compares the preliminary results from 1998 both to estimates from 1996, and to the estimate from the 1997 planting season presented by Falck et al . The results indicate that farmers and the innovators share almost equally rents created by adopting Bt cotton. Farmers gain 43% of total rents whereas the innovators gain 47% of total rents. The regions with low adoption such as California and Missouri lost because farmers suffered a reduction in cotton lint prices without having the benefits of the technology. Finally, it discusses some of the implications of the estimated distribution of rents on farmer and society welfare and impacts of biotechnology varieties in the US and abroad. A sensitivity analysis is performed to evaluate results by reducing the yield and/or cost change assumptions by half. In the worst case scenario, where yield increases and cost reductions were reduced by 50%, farmers still were able to capture 21% of the total rents, whereas the innovators gained 74% of total rents. Farmers share almost equally with the innovators the rents created by the technology even when a monopolistic structure for the input market is assumed.

PEOPLE LEFT BEHIND: TRANSITIONS OF THE RURAL POOR

The effect of policy decisions on the competitiveness of genetically modified (GM) crops was examined. The United States has been an early innovator in the development and use of biotechnology crops and has expanded its export market share of the three major GM crops: soybeans, cotton, and corn. Cotton, soybeans, and corn are all grown in the southern states, but these states have an apparent comparative advantage only in the production of cotton, which may be strengthened with the adoption of genetically modified cotton. The influence of biotechnology on the competitiveness of soybeans and corn for the southern states through the introduction of genetically modified organisms (GMOs) is not clear but is probably negligible.

Open Space at the Rural-Urban Fringe: A Joint Spatial Hedonic Model of Developed and Undeveloped Land Values

Compared to their urban counterparts, the rural poor are more likely to be employed, more apt to be members of married-couple families, less likely to be children, less likely to be minority, and more likely to have assets but a negative income. This paper examines poverty rates and factors that affect mobility in and out of poverty among major categories of the rural poor. Particular attention is paid to farm workers and the rural farm population in the South. It endeavors to identify both structural conditions that perpetuate rural poverty and government interventions that ameliorate human suffering and break the cycle of poverty reproduction.