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.
|Title of host publication||16th Conference|
|Subtitle of host publication||Productivity at the Crossroads: Creating a Socially, Economically and Environmentally Responsible World.|
|Place of Publication||Australia|
|Publisher||Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES)|
|Number of pages||1|
|Publication status||Published - 2010|
|Event||World Productivity Congress and European Productivity Commission Annual Conference - Antalya, Turkey, Turkey|
Duration: 02 Nov 2010 → 05 Nov 2010
|Conference||World Productivity Congress and European Productivity Commission Annual Conference|
|Period||02/11/10 → 05/11/10|
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).