R&D Spillovers: Evidence from U.S. Food Processing,Farm Machinery and Agricultural Sectors |
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Authors: | Munisamy Gopinath Terry L Roe |
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Institution: | 1. Department of Agricultural and Resource Economics , Oregon State University , 213 Ballad Hall, Corvallis , OR , 97331 , USA m.gopinath@orst.edu;3. Department of Applied Economics , University of Minnesota , St.Pau1 , MN , 55108 , USA |
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Abstract: | This paper computes private and social rates of return to R&D capital in the three vertically linked sectors, primary agriculture, food processing, and the farm machinery in the United States. Using a cost function approach, the private rates of return to R&D ranged from an average of 21.5% per annum for farm machinery to 87.5% for agriculture. The social rates of return to R&D in food processing and farm machinery are larger than the private rates due to spillovers. We find that spillovers from public agricultural R&D mitigates the market's failure in farm machinery to fully appropriate the returns to its R&D capital. |
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Keywords: | Intersectoral Spillovers R& D capital Rates of Return |
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