Research incentives and tradeoff for improving productivity of different crops

This paper addresses the balance between different crops and its determination by research investment. This balance results from the cropping-plan decision of the farmers. This decision depends on various factors such as the seed performance, the pest problems, the output prices, etc. We show how the introduction of a productivity decrease due to the market size of each crop is likely to set out a more equilibriated market. Further, our model analysis the main determinants of research investment by a monopoly, and shows that this investment tends to equilibrate the market.