Persistence Pays: U. S. Agricultural Productivity Growth and the Benefits from Public R&D Spending

by Julian M. Alston, Matthew A. Andersen, Jennifer S. James, Philip G. Pardey

Overview

This book documents the evolving path of U.S. agriculture in the 20th Century and the role of public R&D in that evolution. The work begins with a detailed quantitative assessment of the shifting patterns of production among the states and over time and of the public institutions and investments in agricultural R&D. Then, based on newly constructed sets of panel data, some of which span the entire 20th Century and more, the authors present new econometric evidence linking state-specific agricultural productivity measures to federal and state government investments in agricultural research and extension. The results show that the time lags between R&D spending and its effects on productivity are longer than commonly found or assumed in the prior published work. Also, the spillover effects of R&D among states are important, such that the national net benefits from a state’s agricultural research investments are much greater than own-state net benefits. The main findings are consistent across a wide range of reasonable model specifications. In sum, the benefits from past public investments in agricultural research have been worth many times more than the costs, a significant share of the benefits accrue as spillovers, and the research lags are very long. An accelerated investment in public agricultural R&D is warranted by the high returns to the nation, and may be necessary to revitalize U.S. agricultural productivity growth even though the benefits may not be visible for many years.

Product Details

ISBN-13:	9781461425236
Publisher:	Springer New York
Publication date:	02/25/2012
Series:	Natural Resource Management and Policy Series , #34
Edition description:	2010
Pages:	504
Product dimensions:	6.10(w) x 9.25(h) x 0.04(d)

Table of Contents

CONTEXT.- A Brief History of U.S. Agriculture.- INPUTS, OUTPUTS AND PRODUCTIVITY.- Agricultural Inputs.- Agricultural Outputs.- Agricultural Productivity Patterns.- AGRICULTURAL R&D FUNDING AND POLICIES.- Research Funding and Performance.- The Federal Role.- MODELS OF R&D AND PRODUCTIVITY.- Research Lags and Spillovers.- Models of Research and Productivity.- Econometric Estimation and Results.- Productivity Patterns and Research Benefits.- INTERPRETATION AND SYNTHESIS.- Interpretation and Assessment of Benefit-Cost Findings.- Synthesis.

Editorial Reviews

From the reviews:

Persistence Pays is a definitive source book on the economics of agricultural R&D in the United States. The topical coverage is impressively comprehensive, ranging from discussion of the historical development of U.S. agriculture and U.S. agricultural research policy, through a quantification of the patterns of production and input use, to econometric models of R&D and productivity and their implications. The treatment of particular themes is careful and instructive. The authors provide new, detailed, state-level data on both agricultural R&D investments and productivity, along with a critical survey and review of relevant measures, methods, and models, before presenting brand-new econometric results. These new results refine and extend past work in the area, reinforcing many of the past findings about the high social returns to agricultural research and the persistent patterns of underinvestment. The book has significant technical content that will be primarily of interest to other economists both in the classroom and in research applications, but it is also readily accessible to research administrators and policy makers, well beyond the United States, who wish to understand the links between public research policy, agriculture, and the economy.

—Jock R. Anderson. Emeritus Professor of Agricultural Economics at the University of New England, Armidale, Australia, and Adviser, Agriculture and Rural Development, World Bank, Washington, DC.

This is a sophisticated book on a critically important subject. Many people have talked about the importance of public R&D in propelling the growth in American agricultural productivity but there has been scant hard evidence on the issue. Alston, Andersen, James, and Pardey rectify this deficiency with a brilliant book that represents a major contribution to our understanding of technological change—this is the new gold standard in the field. Their achievement is multidimensional—they carefully construct new state-level data series on the quantity and quality of agricultural inputs and outputs, they offer a wealth of information on the institutions and functioning of the public agricultural research system, and they employ well-conceived models and state-of-the-art econometrics to tease out the effects of R&D expenditures on productivity growth. In the process they provide entirely new insights into myriad issues such as the extent of research spillovers, the nature of the lags in R&D investments, and the extent of the policy failures since the 1970s giving rise to a slowdown in farm productivity in the past10–20 years.

—Alan L. Olmstead. Distinguished Research Professor, Department of Economics, University of California, Davis and co-author of Creating Abundance: Biological Innovation and American Agricultural Development, Cambridge University Press, 2008

This book presents new solid empirical evidence about the past, current and required future role of research and innovations to prepare U.S. agriculture to meet future domestic and international food demand in a sustainable manner. The economic rates of return are high and spillovers across states are large. The authors make a strong and well-supported case for expanding federal funding for agricultural research. Global food demand is likely to double over the next 50 years. Given the long time lag between research investments and productivity gains, documented in this book, and the recent global food crisis, expanded investments are long overdue. Policy-makers, advisors and analysts should pay attention to the findings reported in this book and take appropriate action now to stop the current trend of decreasing rates of productivity growth.

—Per Pinstrup-Andersen. H. E. Babcock Professor of Food, Nutrition and Public Policy, J. Thomas Clark Professor of Entrepreneurship, and Professor of Applied Economics at Cornell University; and Professor of Agricultural Economics at Copenhagen University. World Food Prize Laureate, 2001

“The main purpose of this book is to provide a better understanding of the pattern of US agricultural productivity growth … in the USA during the period from 1949 to 2002. … this book is informative and provides a lot of details on the US agricultural sector for both productivity and research funding issues. This book can be treated as a reference book. … it is not only for professionals, but could also be informative to policy makers as well as general readers.” (Sun Ling Wang, European Review of Agricultural Economics, Vol. 37 (3), September, 2010)

From the Publisher