Abstract: This chapter presents the application of the principles of technology adoption to the two most widely grown GM crops – glyphosateresistant (GR) soybeans and Bt corn, discusses the theoretical issues that confront an evaluation of its profitability and analyzes the currently available data to assess the economic gains and their distribution. A technology company identifies a gene that, when inserted in a crop, adds a commercially valuable characteristic. After the gene is inserted, the individual plant is added to the range of varietal material available to the regular plant breeding process. These new commercial varieties, which include the novel gene are commonly referred as genetically modified organisms (GMO). The theoretical analysis of glyphosate-resistant soybean technology reveals that even farmers who do not adopt the technology are likely to benefit from its introduction, since the technology lowers the demand and thereby the prices of nonglyphosate herbicides. Although, the empirical analysis found cost savings in US herbicide markets, unless the technology reduced management costs sufficiently to cover the seed price premium, glyphosate-resistant soybean technology could not pay for itself on those farms. The theoretical and empirical analysis of cost savings from Bt corn found that costs saving from Bt corn are a stochastic variable, depending on the level of ECB infestation, which cannot be determined ahead of time. Farmers who generally face high ECB infestations clearly have more to gain from adopting Bt technology than farmers who face low infestation levels.
Publication Year: 2001
Publication Date: 2001-01-01
Language: en
Type: book-chapter
Indexed In: ['crossref']
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Cited By Count: 9
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