The Benefits and Beneficiaries of "Public" Investment in Herbicide Use Research and Development

The allocation of benefits from research and development of new herbicide uses is dependent on patent status. The agricultural chemical industry will preferentially invest in herbicide R&D that increases the use of on-patent herbicides from which a company can capture a price premium. The distribution of benefits from increased use of on-patent herbicide will alter over time, with grain growers benefiting at the expense of agrichemical companies once the patent expires. Public sector investment in herbicide R&D may also benefit the agrichemical industry. The size and allocation of the benefits from R&D into on-patent herbicides is analyzed using economic surplus techniques. Two case studies are examined. One involves research into the choice and application of herbicide for new wheat varieties. The second case study involves returns from R&D investment in research into an alternative for the commonly used off-patent herbicide trifluralin. The results from the case studies show that herbicide patent status may not have important implications for "public" R&D investment decisions.

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Conference Paper/ Presentation
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JEL Codes:
Q16; Q18; Q28
Series Statement:
Contributed Paper

 Record created 2017-04-01, last modified 2018-01-22

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