The payoffs to agricultural biotechnology: an assessment of the evidence

Transgenic crops are relatively new technologies being adopted rapidly in the United States and in a few other countries. The economic impacts of these technologies have, thus far, been estimated in a piecemeal fashion. The purpose of this study was to collect and characterize the economic evidence available to date, organize it, and determine if any general implications can be drawn from it. The general classes of economic impacts at the farm level are discussed. The types of studies that generate estimates of these benefits are also characterized and categorized in terms of the implications for measuring economic impacts when the set of things held constant in the type of study does not correspond to those that economic theory suggests. The evidence is presented, along with some general implications drawn from the analysis. These implications are: (1) growing transgenic cotton is likely to result in reduced pesticide use in most years and is likely to be profitable in most years in most U.S. states in the Cotton Belt, 2) Bt corn will provide a small but significant yield increase in most years across the U.S. Corn Belt, and in some years and some places the increase will be substantial, and (3) although there is some evidence of a small yield loss in the Roundup Ready soybean varieties, in most years and locations savings in pesticide costs and, possibly, tillage costs will more than offset the lost revenue from the yield discrepancy. There is not yet enough evidence to generalize even these few conclusions to other countries. More farm- level studies in more years and across more locations are required before any additional implications can be drawn. Studies that measure the non-pecuniary benefits and costs of these technologies should be undertaken, as well.