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Abstract

This article examines the impact of Bt corn adoption in the Philippines using an econometric approach that addresses simultaneity, selection, and censoring problems. Although previous literature emphasizes the importance of simultaneity and selection problems, this is the first study that addresses the issue of censoring in estimating the effects of Bt corn adoption at the farm in a developing country context. We show that Bt corn adoption provides modest but statistically significant increases in farm yields and profits. Furthermore, our results provide some evidence of inference errors that can potentially arise when censoring in the pesticide application variable is ignored in the estimation procedures.

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