Costs and benefits of Bt potato with resistance to potato tuber moth in Indonesia
2009
Adiyoga, W., Indonesian Vegetable Research Inst., JI.Tangkuban Perahu 517, Kotak Pos 8413, Lembang, 40391, Jawa Barat (Indonesia) | Norton, G.W., Virginia Polytechnic Inst. and State Univ., Blacksburg, Virginia Tech (USA). Dept. of Agricultural and Applied Economics
This study used an ex-ante analytical framework to evaluate the welfare impact of developing releasing, and adopting Bt potatoes in Indonesia over the past year 2007-2021. The results indicate that the Bt technology in Indonesia potato sector potentially would have a sizeable impact on society's economic welfare. All the scenarios simulated for Bt potato yielded high economic benefits. The worst scenario produced national benefits of USD 1.1 million, while the best scenario provided projected national benefits of USD 133.8 million (across which IRR range at 20-116 percent). Potato farmers gain even with a lower output price because the Bt technology would increase the marketable yield and lower production costs. The extent of adoption of the transgenic Bt potatoes will influence the magnitude of the benefits and will depend in part on the seed premium farmers must pay. For the seed producer/company, profits may increase with higher seed markups under certain conditions, but may also decrease with lower adoption rates. Hence, as with any other new seed-based technology, there is an economic trade-off between the seed markup and the adoption rates. This study has concentrated on the pecuniary benefits and costs of transgenic Bt potato and did not address possible environmental externalities. Nevertheless, it should be mentioned that a lower use of insecticides would have positive impacts on the environment, while the risk of unintended effects, such as gene flow, reduced biodiversity and harm to non-target organisms are perceived to be minimal.
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