Abstract
This article measureseconomic returns to research investment in Chinese agricultureusing the production function approach. A stock-of-knowledgevariable constructed from the past research investment is directlyincluded in the production function as an explanatory variablein the production function. Improved rural infrastructure, irrigation,and education are also included as explanatory variables to avoidthe upward bias in the estimates of returns to agricultural research.A two-way variable coefficients technique is used in the estimationto reduce estimation biases due to the remaining measurementand omitted variables problems. Sensitivity analyses are conductedto test the effects of various lag structures on the return estimates.The results show that rates of return to research investmentin Chinese agriculture are high, ranging from 36% to 90% in1997, and the rates are increasing over time.
This is a preview of subscription content, log in via an institution to check access.
Similar content being viewed by others
References
Alston, J., M. Marra, P. Pardey, and T. Wyatt. (1998). "Research Returns Redux: A Meta-analysis of the Returns to Agricultural R&D." EPTD Discussion paper #38. Washington, D.C.: International Food Policy Research Institute.
Alston, J., B. Craig, and P. Pardey. (1998) "Dynamics in the Creation and Depreciation of Knowledge, and the Returns to Research." EPTD Discussion Paper No. 35. Washington D.C.: International Food Policy Research Institute.
Alston, J., G. Norton, and P. Pardey. (1995). Sciences under Scarcity: Principle and Practice for Agricultural Research Evaluation and Priority Setting. Ithaca: Cornell University Press.
Fan, S. (1991). "Effects of Technological Change and Institutional Reform on Production Growth in Chinese Agriculture." American Journal of Agricultural Economics 73 (May): 266–75.
Fan, S. and P. Pardey. (1998). "Government Spending on Asian Agriculture: Trends and Production Consequence." in Agricultural Public Finance Policy in Asia. Tokyo: Asian Productivity Organization.
Fan, S. and P. Pardey. (1992). Agricultural Research in China: Its Institutional Development and Impact. The Hague: International Service for National Agricultural Research.
Fan, S., and P. Pardey. (1997). "Research, Productivity, and Output Growth in Chinese Agriculture." Journal of Development Economics, Vol. 53:115–137.
Griliches, Z. (1958). "Research costs and social returns: Hybrid Corn and Related Activities." Journal of Political Economics 66 (October): 419–31.
Lau, L. And P. Yotopoulos. (1989). "The Meta-production Function Approach to Technological Change in the World Agriculture." Journal of Development Economics Vol. 31, No. 2: 241–269.
Lin, J., M. Shen, and L. Zhou. (1995). Priorities of Chinese Agricultural Research. Beijing: China Agricultural Press.
Lin, J. (1992). "Rural Reforms and Agricultural Growth in China." American Economics Review 82 (March): 34–51.
Lin, J. (1991). "Public Research Resource Allocation in Chinese Agriculture: "A Test of Induced Technological Innovation Hypotheses." Economic Development and Cultural Change, Vol. 40, No. 1, pp 55–73.
McMillan, J., J. Whalley, and L. Zhu. (1989). "The Impact of China's Economic Reforms on Agricultural Productivity Growth." Journal of Political Economics 97 (August): 781–807.
Ministry of Agriculture. (1980–98). China Agricultural R&D Statistical Materials. Beijing: Science and Technology Department, Ministry of Agriculture.
IDRC and SSTC. (1997). A Decade of Reform: Science and Technology Policy in China. International Development Research Center.
Pardey, P., and B. Craig. (1989). "Causal Relationships between Public Sector Agricultural Research Expenditures and Output." American Journal of Agricultural Economics 71: 9–19.
Pardey, P., J. Roseboom, and J. Anderson, Eds. (1991). Agricultural Research Policy: International Quantitative Perspectives. Cambridge: Cambridge University Press.
Qian, K., S. Fan, and X. Zhu. (1997). Post and Ex-ante Evaluation of Agricultural Research and Efficient Allocation of Research Resources. Beijing: China Agricultural Scientech Press.
Rozelle, S., C. Pray, and J. Huang. (1997). "Agricultural Research Policy in China: Testing the limits of Commeralization-led Reform." Comparative Economic Studies. Summer.
Stone, B. (1990). "Evolution and Diffusion of AgriculturalTechnology in China." Chapter 3 in Sharing Innovation: Global Perspectives on Food, Agriculture, and Rural Development, ed. N.G. Kottle, Smithsonian Institute Press, Washington, D.C., pp. 39–93.
State Statistical Bureau (SSB). (1980–98). China Statistical Yearbook. Beijing: China Statistical Press.
State Statistical Bureau (SSB). (1980–98). China Population Statistical Yearbook. Beijing: China Statistical Press.
State Planning Commission (SPC). (1985–98). China Transportation Yearbook. Beijing: China Transportation Press.
State Statistical Bureau (SSB). (1990). Historical Statistical Materials for Provinces, Autonomous Regions and Municipalities (1949–1989). China Statistical Press.
State Science and Technology Commission (SSTC). (1997). China's Agricultural R&D Policy. Beijing: China Agriculture Press.
State Science and Technology Commission (SSTC). (1985–98). China Science and Technology Statistical Yearbook. Beijing: China Statistical Press.
Author information
Authors and Affiliations
Rights and permissions
About this article
Cite this article
Fan, S. Research Investment and the Economic Returns To Chinese Agricultural Research. Journal of Productivity Analysis 14, 163–182 (2000). https://doi.org/10.1023/A:1007803108805
Issue Date:
DOI: https://doi.org/10.1023/A:1007803108805