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Yes, in your backyard: Forced technological adoption and spatial externalities

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  • Missirian, Anouch

Abstract

I study a phenomenon of hastened technology adoption facilitated by a negative spatial externality. GMO seeds have been engineered to withstand the application of particular weedkillers: farmers can use them in-crop, killing the weeds, leaving the crop unscathed. I show that the adoption of such seeds generates negative externalities on downwind neighbors, increasing the probability of the adoption of the same seed by 29% as well as a conversion of cropland to different crops able to withstand the weedkiller. Overall yields remained unchanged as the benefits of the weedkiller on yields are offset by the negative effects of crop failures for neighbors. Consequences of such rapid adoption include possible monopolization on the seed market.

Suggested Citation

  • Missirian, Anouch, 2024. "Yes, in your backyard: Forced technological adoption and spatial externalities," TSE Working Papers 24-1545, Toulouse School of Economics (TSE).
    • Handle: RePEc:tse:wpaper:129419
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    More about this item

    Keywords

    Technology adoption; spatial externalities; land use; pesticides;
    All these keywords.

    JEL classification:

    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • Q16 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - R&D; Agricultural Technology; Biofuels; Agricultural Extension Services
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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