Public Investment in R&D and Agriculture Productivity in Australia

John Mullen, Yu Sheng, Emily M. Gray

Research output: Book chapter/Published conference paperConference paper

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Abstract

This paper uses time-series data to examine the relationship between public research and development (R&D) and extension investment and productivity growth in Australian broadacre agriculture. The results show that public R&D investment has significantly promoted productivity growth in Australia's broadacre sector over the past five decades (1953 to 2007). The estimated elasticity of total factor productivity (TFP) to knowledge stocks of research (both domestic and foreign) and extension were around 0.20'0.24 and 0.07'0.15 respectively, the ranges reflecting alternative distributions of benefits flowing from knowledge stocks. These elasticities translated into internal rates of return (IRR) of around 15.4'38.2 per cent and 32.6'57.1per cent respectively. While such rates are less than the average IRR reported in the international literature of 100 per cent, they are consistent with previous estimates for Australian agriculture of around 15'40 per cent. These rates of return may be indicative of underinvestment in agricultural R&D in Australia.
Original languageEnglish
Title of host publication16th Conference
Subtitle of host publicationProductivity at the Crossroads: Creating a Socially, Economically and Environmentally Responsible World.
Place of PublicationAustralia
PublisherAustralian Bureau of Agricultural and Resource Economics and Sciences (ABARES)
Pages19
Number of pages1
Publication statusPublished - 2010
EventWorld Productivity Congress and European Productivity Commission Annual Conference - Antalya, Turkey, Turkey
Duration: 02 Nov 201005 Nov 2010

Conference

ConferenceWorld Productivity Congress and European Productivity Commission Annual Conference
CountryTurkey
Period02/11/1005/11/10

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  • Cite this

    Mullen, J., Sheng, Y., & Gray, E. M. (2010). Public Investment in R&D and Agriculture Productivity in Australia. In 16th Conference: Productivity at the Crossroads: Creating a Socially, Economically and Environmentally Responsible World. (pp. 19). Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES).