The economics of innovation and technical change in agriculture

Philip G Pardey, Julian M. Alston, Vernon W. Ruttan

Research output: Chapter in Book/Report/Conference proceedingChapter

41 Scopus citations


Innovation in agriculture differs from innovation elsewhere in the economy in several important ways. In this chapter we highlight differences arising from (a) the atomistic nature of agricultural production, (b) the spatial specificity of agricultural technologies and the implications for spatial spillovers and the demand for adaptive research, and (c) the role of coevolving pests and diseases and changing weather and climate giving rise to demands for maintenance research, and other innovations that reduce the susceptibility of agricultural production to these uncontrolled factors. These features of agriculture mean that the nature and extent of market failures in the provision of agricultural research and innovation differ from their counterparts in other parts of the economy. Consequently, different government policies are implied, including different types of intellectual property protection and different roles of the government in funding and performing research. Informal innovation and technical discovery processes characterized agriculture from its beginnings some 10,000 years ago, providing a foundation for the organized science and innovation activities that have become increasingly important over the past century or two. This chapter reviews innovation and technical change in agriculture in this more-recent period, paying attention to research institutions, investments, and intellectual property. Special attention is given to issues of R&D attribution, the nature and length of the lags between research spending and its impacts on productivity, and various dimensions of innovation outcomes, including rates of return to agricultural research and the distribution of benefits.

Original languageEnglish (US)
Title of host publicationHandbook of the Economics of Innovation
PublisherElsevier B.V.
Number of pages46
StatePublished - 2010

Publication series

NameHandbook of the Economics of Innovation
ISSN (Print)2210-8807

Bibliographical note

Funding Information:
We are grateful for research assistance provided by Connie Chan-Kang, Steve Dehmer, and Sue Pohlod, and for helpful comments and suggestions provided by Matt Andersen, Jennifer James, Alan Olmstead, and Daniel Sumner. The work for this project was partly supported by the University of California, the University of Minnesota, the USDA's Economic Research Service, Agricultural Research Service, and CSREES National Research Initiative, and the Giannini Foundation of Agricultural Economics.


  • Agriculture
  • Factor bias
  • Innovation
  • Intellectual property
  • Market failures
  • Productivity
  • Research lags
  • Spillovers


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