Developing capabilities in the seed industry: which direction to follow?

Since the 1990s, many developing country policy makers have assumed that plant genetic engineering represents the only technological frontier in seed innovation; that it has been the leading technology for improving seeds and agricultural performance in those countries where it has been adopted; and that it is the area of biotechnology in which domestic capabilities in seed innovation should be accumulated. In this paper we challenge all those assumptions through an exploration of the role that both genetic engineering and other seed innovation techniques have played in explaining dynamism in the seed market, and wider agricultural economy, in Argentina, focusing on the case of soy. We argue that existing analyses of the impact of plant genetic engineering in Argentina either ignore the performance gains from seed innovations based on techniques other than genetic engineering or misattribute them to genetic engineering. Our analysis, based on data of registered plant varieties, evidence of agricultural performance in Argentina, and interviews with company managers and public sector researchers, seeks to distinguish between the impacts that different approaches to seed innovation have had on the soy sector. We argue that, from the data available, non-genetic engineering seed innovations appear to have had a very significant direct effect on farm-level soy productivity, much more so than those based on genetic engineering, and that they offer just as plausible a contributing explanation for indirect effects on productivity that are normally attributed to genetic engineering. Our findings are preliminary, but they stand in stark contrast to the very widely held view that genetic engineering has played a central, transformative role in the revitalisation and internationally competitive performance of soy production in Argentina over the last two decades. They also have a number of potential implications for the allocation of resources and policy support to the seed industry, and, more generally to how technological options should be considered and assessed in strategies for developing technological capabilities. Our analysis is framed by and contributes to an emerging body of research within the innovation literature that challenges deterministic, unidirectional approaches to analysing technological change in emerging economies.