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The importance of disaggregation for understanding research impacts and modelling adoption

Author

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  • Davis, Jeff
  • Bantilan, Ma Cynthia S.
  • Nedumaran, Swanikannu
  • Charyulu, Deevi Kumara

Abstract

Most applications of applied welfare analysis to measuring the returns to agricultural R&D still model the shift in supply and adoption patterns at a relatively aggregated level. Some still use mathematical manipulation of the nature of the supply shift to offset suspected aggregation errors. This paper briefly reviews the issues involved and highlights the importance of a disaggregated analysis to overcome any such expected errors. It is shown that not only does simple disaggregation overcome concerns with mathematical manipulation but it also enhances our ability to better model the adoption of research outputs by separating the applicability of the technology from other factors which influence adoption. This leads to some important insights which facilitate better understanding of the final outcomes and impacts of research outputs. An empirical application of the proposed disaggregated modelling to an ex post impact assessment study of short duration, fusarium wilt resistant chickpea breeding by ICRISAT and NARS partners is used to illustrate some important issues. It is shown that if the analysis is disaggregated to more realistically represent the applicability of research outputs and adoption using heterogeneous production and decision-making environments the results provide a better understanding of the impacts. This is accomplished by disaggregation based on different categories of adopters as well as differences in their underlying production environments. In addition the understanding of the distribution of welfare gains between producers and consumers is shown to be significantly different to the results for an aggregated analysis, with some policy implications being different to those drawn in many past studies. For example, even for the situation when the relative elasticity’s are such that an aggregate analysis suggests consumers are the primary beneficiaries of agricultural research, a disaggregated analysis reveals that producers who adopt the technologies may gain considerably more than consumers, but this is offset by significant welfare losses for the non-adopting producers.

Suggested Citation

  • Davis, Jeff & Bantilan, Ma Cynthia S. & Nedumaran, Swanikannu & Charyulu, Deevi Kumara, 2014. "The importance of disaggregation for understanding research impacts and modelling adoption," 2014 Conference (58th), February 4-7, 2014, Port Macquarie, Australia 165820, Australian Agricultural and Resource Economics Society.
    • Handle: RePEc:ags:aare14:165820
    DOI: 10.22004/ag.econ.165820
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    References listed on IDEAS

    as
    1. 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.
    2. Mausch, Kai & Chiwaula, L. & Irshad, A. & Bantilan, Ma Cynthia S. & Silim, S. & Siambi, M., 2013. "Strategic Breeding Investments for Legume Expansion: Lessons Learned from the Comparison of Groundnut and Pigeonpea," 2013 Conference (57th), February 5-8, 2013, Sydney, Australia 152168, Australian Agricultural and Resource Economics Society.
    3. Alston, Julian M. & Freebairn, John W. & James, Jennifer S., 2004. "Levy-funded research choices by producers and society," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 48(1), pages 1-32.
    4. William S. Wise & Elisabeth Fell, 1980. "Supply Shifts and the Size of Research Benefits: Comment," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 62(4), pages 838-840.
    5. R. K. Lindner & F. G. Jarrett, 1980. "Supply Shifts and the Size of Research Benefits: Reply," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 62(4), pages 841-844.
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    7. R. K. Lindner & F. G. Jarrett, 1978. "Supply Shifts and the Size of Research Benefits," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 60(1), pages 48-58.
    8. Charyulu, D. Kumara & Shyam, D. Moses & Bantilan, Ma Cynthia S. & Nedumaran, S. & Davis, Jeff, 2014. "Unit Cost Reduction across Production Environments and Measurement of Welfare Changes," 2014 Conference (58th), February 4-7, 2014, Port Macquarie, Australia 165847, Australian Agricultural and Resource Economics Society.
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