TITLE:
Benefits of Public R & D in US Agriculture: Spill-Ins, Extension, and Roads
AUTHORS:
Sunling Wang, Alejandro Plastina, Lilyan E. Fulginiti, Eldon Ball
KEYWORDS:
US Agricultural Productivity, Public R & D, Spill-Ins, Extension, Roads, Internal Rate of Return, Cost Function
JOURNAL NAME:
Theoretical Economics Letters,
Vol.7 No.6,
October
31,
2017
ABSTRACT: This paper uses panel data for the
1980-2004 period to estimate the contributions of public research to US
agricultural productivity growth. Local and social internal rates of return are
estimated accounting for the effects of R & D spill-in, extension
activities and road density. R & D spill-in proxies were constructed based
on both geographic proximity and production profile to examine the sensitivity
of the rates of return to these alternatives. We find that extension
activities, road density, and R & D spill-ins, play an important role in enhancing the benefit of
public R & D investments. We also find that the local internal rates of
return, although high, have declined through time along with investments in
extension, while the social rates have not. Yet, the social rates of return are
not robust to the choice of spill-in proxy.