Guanming Shi

Commercialized transgenic traits, maize productivity and yield risk

111 1. Zerbino, D.r. et al. Science 336, 179–182 (2012). 2. Tan, T.W. et al. BMC Genomics 10 (suppl 3), S36 (2009). 3. Wollman, r. & Stuurman, N. J. Cell Sci. 120, 3715– 3722 (2007). 4. Joyce, A. & palsson, B. Nat. Rev. Mol. Cell Biol. 7, 198–210 (2006). 5. Arnaout, r. et al. PLoS ONE 6, e22365 (2011). 6. Brown, B., chui, M. & Manyika, J. McKinsey Q. 4, 24–35 (2011). 7. Taylor, c.r. Am. Econ. Rev. 85, 872–890 (1995). 8. Scotchmer, S. Innovation and Incentives (MIT press, cambridge, MA; 2004). 9. Levine, D.K. Science 323, 1296–1297 (2009). 10. Terwiesch, c. & Xu, Y. Manage. Sci. 54, 1529–1543 (2008). 11. Travis, J. Science 319, 1750–1752 (2008). 12. Howe, J. Crowdsourcing (crown Books, New York; 2008). 13. eiben, c.B. et al. Nat. Biotechnol. 30, 190–192 (2012). 14. Khatib, F. et al. Proc. Natl. Acad. Sci. USA 108, 18949–18953 (2011). 15. cooper, S. et al. Nature 466, 756–760 (2010). 16. Khatib, F. et al. Nat. Struct. Mol. Biol. 18, 1175–1177 (2011). 17. Scudellari, M. Nat. Med. 18, 326 (2012). 18. Jeppesen, L. & Lakhani, K.r. Organ. Sci. 21, 1016– 1033 (2010). 19. Boudreau, K.J., Lacetera, N. & Lakhani, K.r. Manage. Sci. 57, 843–863 (2011). 20. Marbach, D. et al. Nat. Methods 9, 796–804 (2012). 21. Boyd, S.D. et al. Sci. Transl. Med. 1, 12ra23 (2009). 22. Weinstein, J.A. et al. Science 324, 807–810 (2009). 23. robins, H.S. et al. Sci. Transl. Med. 2, 47ra64 (2010). 24. Jung, D. et al. Annu. Rev. Immunol. 24, 541–570 (2006). 25. Altschul, S.F. et al. J. Mol. Biol. 215, 403–410 (1990). 26. Brochet, X. et al. Nucleic Acids Res. 36, W503–W508 (2008). 27. Hong, L. & page, S. Proc. Natl. Acad. Sci. USA 101, 16385–16389 (2004). and collected data. R.A.A. identified and codeveloped the immunogenomics problem, tested the submissions and helped write the manuscript. M.L. and L.B. codeveloped the problem statement and test data. P.-R.L. analyzed and categorized all submission data and helped write the manuscript.

An Analysis of the Pricing of Traits in the U.S. Corn Seed Market

This paper investigates the pricing of patented traits in the U.S. hybrid corn seed market under imperfect competition. In a multiproduct context, we first examine how substitution/complementarity relationships among products can affect pricing. This is used to motivate multi-product generalizations of the Herfindahl-Hirschman index (GHHI) capturing cross-market effects of imperfect competition on bundle pricing. The GHHI model is applied to pricing of conventional and patented biotech seeds in the US from 2000-2007. One major finding is that standard component pricing in biotech traits is soundly rejected in favor of subadditive bundle pricing. The econometric estimates show how changes in market structures (as measured by both own- and cross-Herfindahl indexes) affect U.S. corn seed prices.

BUNDLING AND LICENSING OF GENES IN AGRICULTURAL BIOTECHNOLOGY

We examine the strategic incentive for gene holders to vertically integrate with seed companies and chemical input companies. With homogeneous conventional seeds, we find that a pure bundling strategy (produce the genetically modified seed only) is dominant. When the gene holder and breeder are, respectively, the monopolistic producers of genetically modified and conventional seeds, they may commit to mixed bundling (supply both genetically modified and conventional seed) to deter potential entry to the conventional seed market. A vertical merger may solve the credibility issue of the mixed bundling commitment through third party licensing agreements in the conventional seed market. Copyright 2009, Oxford University Press.

An Analysis of Selectivity in the Productivity Evaluation of Biotechnology: An Application to Corn

We investigate selectivity bias in the evaluation of biotech hybrid productivity. The analysis is applied to experimental data on Wisconsin corn yields from 1990 to 2010. Relying on a Heckman-like factor that accounts for selectivity, we find evidence of selection bias, indicating that some of the observed yield advantage associated with GM hybrids can be attributed to their conventional genes. We document how the rising market concentration of biotech firms has contributed to increasing selectivity bias in corn yield. The impact, however, is offset by the negative effect of the rising adoption rate of GM corn on selectivity bias. Copyright 2013, Oxford University Press.

On Pricing and Vertical Organization of Differentiated Products

This paper investigates the pricing and vertical organization of differentiated products under imperfect competition. In a multiproduct context, a Cournot model is used to examine how substitution/complementarity relationships among products and vertical structures can affect the exercise of market power. This motivates a generalization of the Herfindahl-Hirschman index (termed VHHI) capturing how market concentration and vertical structures interact to influence prices of differentiated products. The analysis is applied to pricing of soybean seeds in the US over the period 2000-2007. We consider two vertical structures employed by biotech firms: vertical integration and licensing. The econometric analysis finds evidence that vertical organization has significant effects on seed prices. These effects are found to vary depending on the institutional setup and the bundling of genetic material. The empirical evidence shows that complementarity and economies of scope can reduce the effects of market concentration on prices.

An Analysis of Bundle Pricing: The Case of the Corn Seed Market

This paper investigates bundle pricing under imperfect competition. In a multiproduct context, we first examine how substitution/complementarity relationships among products can affect pricing. This is used to motivate multi-product generalizations of the Herfindahl-Hirschmann index (GHHI) capturing cross-market effects of imperfect competition on bundle pricing. The GHHI model is applied to pricing of conventional and patented biotech seeds in the US from 2000-2007. One major finding is that standard component pricing in biotech traits is soundly rejected in favor of sub-additive bundle pricing. This result is consistent with the presence of scope economies in the production of genetic traits. The econometric estimates show how changes in market structures (as measured by both own- and cross-Herfindal indexes) affect U.S. corn seed prices.

Industrial Hemp: China's Experience and Global Implications

This article examines major factors of Chinas hemp production and export and derives implications for the global market and the ongoing debate in the United States. Although Chinas declining hemp production is mainly due to the low relative purchase price, its lack of response to changes in the world market is a result of the extremely low price transmission elasticity from world price to domestic price. One major implication is that Chinas ongoing market reform is likely to have a positive impact on its hemp production and export and a negative impact on the world price and the projected profit for U.S. farmers.

Effectiveness of Intellectual Property Protection: Survey Evidence from China

This paper examines Chinese pesticide firms’ use and perceptions of various means of intellectual property (IP) protection in protecting their innovations, using a unique dataset from 97 pesticide firms surveyed in 2008. These firms rate Chinese patents as quite effective in protecting their IP from infringement, although 70 percent of them state that improved enforcement is needed. Those firms that have been granted patents and those that claim their patents have been infringed upon both give lower ratings to the perceived effectiveness of patents. Trademarks are rated as less effective than patents, but firms that have had experience with patenting and infringement of patents tend to rate trademarks as more effective than those firms that do not have direct experience with the patent system. General government policies to encourage increased privatization, more private R&D, and higher education are associated with more faith in IP, but policies to strengthen IP by promoting mandatory IP training and the development of specialized IP divisions in the firms do not influence perceptions of IP effectiveness. We conclude that if the Chinese government wants to encourage innovation using IP protection, it must focus on improving the enforcement of patents.

Chapter 6 Spatial Pricing of Genetically Modified Hybrid Corn Seeds

Objective – The current biotechnology revolution has been associated with newly developed genetic modifications (GM) that offer new prospects for increasing agricultural productivity. This has stimulated a rapid adoption of GM corn hybrids by U.S. farmers. Yet, there is concern about the structure of competition among biotech firms that own patents over GM traits. This chapter evaluates the spatial differences in pricing of biotech corn hybrids, with a focus on the fringe versus core regions of the U.S. Corn Belt. Methods – The analysis examines how local conditions and market concentrations affect the pricing of GM corn hybrids in different locations. Results – We find evidence of more extensive subadditive pricing in the fringe region. We also examine how both own- and cross-market concentrations affect prices across regions. For GM hybrids, the results show that market power is generally more prevalent in the core region compared to the fringe. Conclusions – The evidence shows that the pricing of GM corn hybrids varies across space. The observed pricing schemes benefit farmers more in the fringe than in the core region of the Corn Belt.