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Transcript of Agricultural Research and Biotechnology Dr. George Norton Agricultural and Applied Economics...
Agricultural Research and Biotechnology
Dr. George NortonAgricultural and
Applied EconomicsVirginia Tech
Copyright 2008
AAEC 3204AAEC 3204
Objectives
Discuss economic issues associated with agricultural research• Research as an investment• Distributional effects• Public versus private research• Types of organization of
research• International research centers• Biotechnology
Role of agricultural research
• Increase productivity of existing resources• Generate higher productivity inputs and ways
of producing food• Design new or improved institutional
arrangements
Summary: Research produces new technologies and new institutions
Effects of Agricultural Research
• Reduces cost per unit of production, potentially increasing farm incomes
• Agr. production increases can reduce food prices or generate foreign exchange
• Demand for labor may increase or decrease• Distributional effects occur by farm size, type
of farm, income distribution• Potential effects on risk, food security, and
environment
Distributional effects of research
• Consumers versus producers• Income distribution and nutrition• Farm size effects• Land versus labor• Owners versus tenants• Regional effects• Environmental effects
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Economic surplus analysis
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Economic Surplus analysis with trade
High rates of return for agricultural research How are these returns measured?
1. By estimating a production function: Ag Output = F (land, labor, fertilizer, research,
extension, education) Use results in a benefit cost analysis
2. By calculating changes in economic surplus
Why should the public sector get involved with research?Insufficient private incentive because of Public good nature of some research Risk Farms are small
What are intellectual property rights and why are they important for agricultural research?
Examples: patents, copyrights, plant breeder’s rights
Create incentives for private firms to undertake research because they can profit from their discoveries
Broad categories of research
Basic research Applied research Adaptive research testing
Countries have 3 options with respect to research Direct transfer Borrow and adapt Comprehensive research
What determines choice among these? Cost Environmental sensitivity Differences in resource base Availability of research to transfer in
Sources of new technologies Public and private research followed by local
technology transfer Technologies transferred in from other
countries (and often adapted before adopted)
International Technology Transfer: the Green Revolution
What was the green revolution?
Where did it occur?
When did it occur?
What were its distributional effects?
Hayami and Ruttan’s green revolution conclusions• Rapid adoption of varieties where suited and
superior to local varieties• Farm tenure did not prove to be a serious constraint
to adoption• Wheat and rice technologies have increased
demand for labor• New varieties have increased regional disparities• New varieties have kept down consumer prices
History of International Agricultural Research Centers• Rockefeller and Ford
Foundations began work in Mexico in 1940’s
• CIMMYT and IRRI established in early 1960’s
• CGIAR system with its common funding and Technical Committee in 1971
International Agricultural Research Centers
Modern Biotechnologies
Examples:• Marker assisted breeding• Tissue culture• Genetically modified organisms (GMOs)
• Pest resistance• Drought, salt, or cold tolerance• Nutritional enhancement of crops• Pharmaceutical products from plants
• Genomics• PCR disease diagnostics
Genetically Modified Organisms (GMOs)
• What are GMOs?• Where do they come from?• Why might economic issues ultimately
determine the value of GMOs?• Do you think GMOs will help in reducing
world hunger? Why or why not?• Do you think GMOs will help improve human
health and the environment, or harm them?
What are genetically modified foods?
Also called genetically modified organisms (GMO). Involves the insertion of DNA from one organism into
another OR modification of an organism’s DNA in order to achieve a desired trait.
+ A strawberry resistant to frost
4 5
Arctic fish DNA strawberry
=
Examples of GMO’s
Golden rice – rice that contains beta-carotene (Vitamin A), which is not found in regular rice.
Bt corn – corn that contains a chemical normally found in a bacterium (Bacillus thuringiensis) that is toxic to insects but not to humans.
Herbicide resistant plants.
Rice
Tobacco
Eggplant
How are plants modified?
• Agrobacterium that normally normally infects plants with disease is used to infect plant with gene of interests or…
• A particle gun is used to shoot small bits of metal coated with the gene into the plant.
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How are animals modified?
The microinjection method uses a fine needle to inject a solution of DNA into a developing embryo.
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Potential Benefits of GMOs
Humanitarian:
More food
Cheaper food
Reduced risk
Increased nutrition
Reducing world hunger and improving world health
Pest resistance
Herbicide resistance
Cold tolerance
Drought tolerance
Edible vaccines
Environmental: reduced use of pesticides in farming.
Potential Environmental Hazards
Reduced effectiveness of pesticides as insects become resistant to engineered toxins.
Loss of biodiversity
Harm to other organismsPollen from Bt corn was found to
cause high mortality rates in monarch butterfly larvae. BUT follow-up studies have shown that the exposure levels in the
fields are negligible
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Potential Environmental Hazards
Gene Transfer to non-target species Herbicide resistant plants and weeds could
cross breed and create “superweeds” To address this one could:
Create sterile male plants that don’t produce pollen Engineer the plants so that pollen doesn’t contain the
foreign genes Create buffer zones of non-GM crops around GM
crops. The buffer crops would not be harvested.
Potential Human Health Risks
Allergens Genetic engineering could potential introduce or create
allergens For example, inserting genes from a nut into another
plant could be dangerous for people who are allergic to nuts
Unknown health risks Biological processes involve a lot of INTERACTIONS It is often difficult to identify every possible interaction.
Economic Hazards
Reduced competition GM seeds are patented
Suicide seeds Plants with sterile seeds that are infertile are
created Farmers are forced to buy seeds every year
However, some companies have reduced costs or donated GM seeds to impoverished nations.
Creating a balance
So are GM foods a good or bad thing?
It depend on each individual case.
Consumers, the government and scientists should be responsible for weighing the benefits against the costs.
Economic benefits
Improved Nutrition
Resistance to disease
Reduced use of chemicals
Environmental risks
Health risks
Economic risks
Components of a well-linked agricultural research system for developing countries International
agricultural research centers
Public agricultural research in developed countries
National and local public experiment
stations
On-farm research and
extension
Private companies producing research results
.
Domestic Technology Transfer: AgriculturalExtension
Speeds up transfer of knowledge
Many types of extension systems in the world
Examples:• Local and regional offices with specialists and
generalists• Training and visit system with regional offices• Integrated into farming systems research and
extension
What types of systems for technology transfer are most cost effective?
Depends on information technology
Depends on audience, types of technologies to transfer, infrastructure, etc.
Depends on incentives for private sector
Requirements of a successful extension worker• Technical competence• Economic competence• Farming competence• Communications
competence
Summary of effects of research and extension education
• Production, productivity, and efficiency up• Food prices down• Extension speeds up technology transfer• Distributional effects• Incomes up• Solutions to environmental problems