Hostname: page-component-cd9895bd7-gvvz8 Total loading time: 0 Render date: 2024-12-23T09:29:06.157Z Has data issue: false hasContentIssue false
  • English
  • Français

Commodity R&D and Promotion

Published online by Cambridge University Press:  28 April 2015

Timothy J. Richards  and
Luis Padilla
Timothy J. Richards
Affiliation:
National Food and Agricultural Policy Project, Morrison School of Agribusiness and Resource Management, Arizona State University, Mesa AZ
Luis Padilla
Affiliation:
National Food and Agricultural Policy Project, Morrison School of Agribusiness and Resource Management, Arizona State University, Mesa AZ
Get access Rights & Permissions [Opens in a new window]

Abstract

Considerable evidence exists of high returns to public and private investment in commodity research and development programs. This study investigates the potential returns to product research, development, and marketing in a dynamic commodity-market model. Theoretical hypotheses derived from the solution to this model are tested in an empirical example of Washington apples. Estimation results show that, despite significant spillovers to research and promotion expenditure in this industry, there is nonetheless considerable latitude to increase annual sales.

Keywords

advertisingcommodityinnovationoptimal controlPoisson modelresearch and developmentL15M37Q13Q16
Type
Articles
Information
Journal of Agricultural and Applied Economics , Volume 34 , Issue 3 , December 2002 , pp. 401 - 415
Copyright
Copyright © Southern Agricultural Economics Association 2002

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Alston, J.M., Chalfant, J.A., Christian, J.E., Meng, E., and Piggott, N.E.. The California Table Grape Commission's Promotion Program: An Evaluation. Oakland, CA: Giannini Foundation, Monograph Number 43, 1997.Google Scholar
Alston, J.M., and Pardey, P.G.. Making Science Pay: The Economics of Agricultural R&D Policy. Washington, DC: AEI Press, 1996.Google Scholar
Cameron, A.C., and Trivedi, P.K.. “Econometric Models Based on Count Data: Comparisons and Applications of Some Estimators and Tests.” Journal of Applied Econometrics 1(1986):29–53.CrossRefGoogle Scholar
Carey, C., and Bolton, D.L.. “Brand Versus Generic Advertising and the Decision to Advertise Collectively.” Review of Industrial Organizations 11(1996):93–105.Google Scholar
Chintagunta, P.K., and Jain, D.. “A Dynamic Model of Channel Member Strategies for Marketing Expenditures.” Marketing Science 11(Spring 1992):168-88.CrossRefGoogle Scholar
Choi, J. “Cooperative R&D with Product Market Competition.” International Journal of Industrial Organization 11(1993):553-71.CrossRefGoogle Scholar
Chou, C., and Shy, O.. “New Product Development and the Optimal Duration of Patents.” Southern Economic Journal 57(1991):811-21.CrossRefGoogle Scholar
Cincera, M. “Patents, R&D, and Technological Spillovers at the Firm Level: Some Evidence from Econometric Count Models for Panel Data.” Journal of Applied Econometrics 12(1997):265-80.3.0.CO;2-J>CrossRefGoogle Scholar
Cox, T. “A Rotterdam Model Incorporating Advertising Effects: The Case of Canadian Fats and Oils.” Commodity Advertising and Promotion. Kinnucan, H.W., Thompson, S.R., and Chang, H.S., eds. Ames, IA: Iowa State Press, 1992.Google Scholar
Crepon, B., and Duguet, E.. “Estimating the Innovation Function from Patent Numbers: GMM on Count Panel Data.” Journal of Applied Econometrics 12(1997):243-63.3.0.CO;2-4>CrossRefGoogle Scholar
d'Aspermont, C., and Jacquemin, A.. “Cooperative and Noncooperative R&D in Duopoly with Spillovers.” American Economic Review 78(1988):1133-37.Google Scholar
Ehrlich, I., and Fisher, L.. “The Derived Demand for Advertising: A Theoretical and Empirical Investigation.” American Economic Review 72(June 1982):366-88.Google Scholar
Fang, C., and Goddard, E.. “Optimal Investment Allocation in Generic Advertising and Research: The Case of the Canadian Beef, Egg, Pork and Milk Industries.” Paper presented at the American Agricultural Association Annual Meetings, Indianapolis, IN, August 1995.Google Scholar
Fuglie, K., Ballenger, N., Day, K., Klotz, C., dinger, M., Reilly, J., Vasavada, U., and Yee, J.. Agricultural Research and Development: Public and Private Investments Under Alternative Markets and Institutions. Washington, DC: U.S. Department of Agriculture, Economic Research Service, Agricultural Economic Report No. 735, 1996.Google Scholar
Geroski, P.A. “In Pursuit of Monopoly Power: Recent Quantitative Work in Industrial Economics.” Journal of Applied Econometrics 3(April 1988):107-23.CrossRefGoogle Scholar
Gopinath, M., and Vasavada, U.. “Patents, R&D, and Market Structure in the U.S. Food Processing Industry.” Journal of Agricultural and Resource Economics 24(July 1999):127-39.Google Scholar
Griliches, Z. “Patent Statistics as Economic Indicators: A Survey.” Journal of Economic Literature 28(1990):1661-707.Google Scholar
Hall, B.H., Griliches, Z., and Hausman, J.A.. “Patents and R&D: Is There a Lag?” International Economic Review 27(1986):265-83.CrossRefGoogle Scholar
Hamilton, S.F., and Sunding, D.L.. “Returns to Public Investments in Agriculture with Imperfect Downstream Competition.” American Journal of Agricultural Economics 80(November 1998):830-38.CrossRefGoogle Scholar
Hausman, J.A., Hall, B.H., and Griliches, Z.. “Econometric Models for Count Data with an Application to the Patents-R&D Relationship.” Econometrica 52(1984):909-38.CrossRefGoogle Scholar
Huang, S., and Sexton, R.. “Measuring Returns to an Innovation in an Imperfectly Competitive Market: Application to Mechanical Harvesting of Processing Tomatoes in Taiwan.” American Journal of Agricultural Economics 78(August 1996):558-71.CrossRefGoogle Scholar
Huffman, W.E., and Evenson, R.E.. Science for Agriculture—A Long-Term Perspective. Ames, IA: Iowa State Press, 1993.Google Scholar
Jacquemin, A.P. “Optimal Control and Advertising Policy.” Metroeconomica 25(1973):200-9.CrossRefGoogle Scholar
Kamien, M.I., and Schwartz, N.L.. Dynamic Optimization: The Calculus of Variations and Optimal Control in Economics and Management. New York, NY: North Holland, 1981.Google Scholar
Katz, M. “An Analysis of Cooperative Research and Development.” Rand Journal of Economics 17(1986):527-43.CrossRefGoogle Scholar
Kinnucan, H. “Advertising Traded Goods.” Journal of Agricultural and Resource Economics 24(July 1999):38–56.Google Scholar
Kotowitz, Y., and Mathewson, F.. “Advertising, Consumer Information, and Product Quality.” The Bell Journal of Economics 10(Autumn 1979):566-88.CrossRefGoogle Scholar
Lanjouw, J.O., Pakes, A., and Putnam, J.. “How to Count Patents and Value Intellectual Property: The Uses of Patent Renewal and Application Data.” The Journal of Industrial Economics 46(December 1998):405-32.CrossRefGoogle Scholar
Lemieux, C.M., and Wohlgenant, M.K.. “Ex-Ante Evaluation of the Economic Impact of Agricultural Biotechnology: The Case of Porcine Somatotropin.” American Journal of Agricultural Economics 71(November 1989):903-14.CrossRefGoogle Scholar
Levin, R.C., and Reiss, P.C.. “Tests of a Schumpe-terian Model of R&D and Market Structure.” R&D, Patents, and Productivity. Griliches, Z., ed. Chicago: University of Chicago Press, 1984.Google Scholar
Moschini, G., and Lapan, H.. “Intellectual Property Rights and the Welfare Effects of Agricultural R&D.” American Journal of Agricultural Economics 79(November 1997):1229-42.CrossRefGoogle Scholar
Nerlove, M., and Arrow, K.. “Optimal Advertising Policy Under Dynamic Conditions.” Economica (May 1962):129-42.CrossRefGoogle Scholar
Richards, T.J., and Patterson, P.M.. “New Varieties and the Returns to Commodity Promotion: Washington Fuji Apples.” Agricultural and Resource Economics Review 29(2000):10–23.CrossRefGoogle Scholar
Rickertsen, K. “The Effects of Advertising in an Inverse Demand System.” Discussion paper No. D-04/1996, As, Norway: Department of Economics and Social Sciences, Agricultural University of Norway, 1996.Google Scholar
Sethi, S.P. “Dynamic Optimal Control Models in Advertising: A Survey.” SIAM Review 19(October 1977):685-25.CrossRefGoogle Scholar
Slade, M.E. “Product Rivalry with Multiple Strategic Weapons: An Analysis of Price and Advertising Competition.” Journal of Economics and Management Strategy 4(Fall 1995):445-76.Google Scholar
United States Department of Agriculture—CSREES. Current Research Information System. Washington, DC, various years.Google Scholar
United States Patent and Trademark Office. Patent and Trademark Data. Internet site: http://www.uspto.gov/web/offices/ac/ido/oeip/taf/re-ports.htm (Accessed May 15, 1999b).Google Scholar
Vande Kamp, P., and Kaiser, H.. “Optimal Temporal Policies in Fluid Milk Advertising.” American Journal of Agricultural Economics 82(May 2000):274-86.CrossRefGoogle Scholar
Vidale, M.L., and Wolfe, H.B.. “An Operations Research Study of Sales Response to Advertising.” Operations Research 5(1957):370-81.CrossRefGoogle Scholar
Voon, T.J., and Edwards, G.W.. “Research Payoff from Quality Improvement: The Case of Protein in Australian Wheat.” American Journal of Agricultural Economics 74(1992):564-72.CrossRefGoogle Scholar
Wang, P., Cockburn, I.M., and Puterman, M.L.. “Analysis of Patent Data—A Mixed-Poisson-Regression-Model Approach.” Journal of Business and Economic Statistics 16(January 1998):27–41.Google Scholar
Ward, R.Evaluation of Washington Apple Advertising Programs. Wenatchee, WA: Washington Apple Commission, 1993.Google Scholar
Washington Apple Commission. Summary of Program Expenditures. Wenatchee, WA, 1998.Google Scholar
Wohlgenant, M. “Distribution of Gains from Research and Promotion in Multi-Stage Production Systems: The Case of U.S. Beef and Pork Industries.” American Journal of Agricultural Economics 75(August 1993):642-51.CrossRefGoogle Scholar