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A Cross‐Commodity Appraisal Of Demand‐Raising Research Benefits: Pork And Chicken In Australia

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  • T. J. P. Voon

Abstract

A multi‐commodity model is developed for evaluating the gains from research which raises the demand for a commodity, and applied to the pig and chicken industries in Australia. The major finding is that the gain to pork producers is larger, and the gain to consumers smaller, with a cross‐commodity consideration than without. Bigger differences in results are observed with larger values of the cross‐price elasticity between pork and chicken, and with a larger shift in demand for chicken. However, the aggregate benefits to the Australian pig industry are not significantly affected by price changes in the market for chicken. The implication of the analysis is that, by ignoring the cross‐market feedback between commodities closely related in consumption, consumers (or taxpayers) of the commodity experiencing a rise in demand may bear a higher‐than‐optimal outlay on public research directed to increasing the demand for that commodity.

Suggested Citation

  • T. J. P. Voon, 1992. "A Cross‐Commodity Appraisal Of Demand‐Raising Research Benefits: Pork And Chicken In Australia," Journal of Agricultural Economics, Wiley Blackwell, vol. 43(2), pages 243-247, May.
    • Handle: RePEc:bla:jageco:v:43:y:1992:i:2:p:243-247
    DOI: 10.1111/j.1477-9552.1992.tb00218.x
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    References listed on IDEAS

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    2. Norton, George W. & Davis, Jeffrey S., 1979. "Review Of Methods Used To Evaluate Returns To Agricultural Research," Staff Papers 13520, University of Minnesota, Department of Applied Economics.
    3. Roger N. Rose, 1980. "Supply Shifts and Research Benefits: Comment," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 62(4), pages 834-837.
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    6. Alston, Julian M., 1990. "Research Benefits in a Multimarket Setting," ISNAR Archive 310790, CGIAR > International Food Policy Research Institute (IFPRI).
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