Public Investment in R&D and Agriculture Productivity in Australia

John Mullen, Yu Sheng, Emily M. Gray

    Research output: Book chapter/Published conference paperConference paperpeer-review

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    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)
    Number of pages1
    Publication statusPublished - 2010
    EventWorld Productivity Congress and European Productivity Commission Annual Conference - Antalya, Turkey, Turkey
    Duration: 02 Nov 201005 Nov 2010


    ConferenceWorld Productivity Congress and European Productivity Commission Annual Conference


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