Are the economic benefits of Bt cotton sustainable? Evidence from Indian panel data

Jonas Kathage and Matin Qaim
Additional contact information
Jonas Kathage: Georg-August-University Göttingen
Matin Qaim: Georg-August-University Göttingen

No 80, Courant Research Centre: Poverty, Equity and Growth - Discussion Papers from Courant Research Centre PEG

Abstract: While several studies have shown that genetically modified Bt cotton can benefit smallholder farmers economically, the sustainability of these effects is still unclear and debated controversially between biotechnology proponents and critics. We use unique panel data of 533 cotton farmers, collected in India between 2002 and 2008, to analyze Bt impacts on cotton yield, profit, and household living standards. Results from fixed effects models show that the adoption of Bt cotton is associated with a net yield gain of 24% and a profit increase of 50%. These benefits per acre were stable over time; there are even indications that they increased. Given rising adoption rates, the aggregate benefits grew substantially. We further show that Bt cotton adoption raised consumption expenditures, our measure of household living standards, by 18% during the 2006-2008 period. We conclude that Bt cotton has created large and sustainable benefits, which contribute to economic development in India.

Keywords: biotechnology; Bt cotton; genetically modified crops; farm survey; household living standards; India; technology adoption (search for similar items in EconPapers)
JEL-codes: I31 Q12 Q13 Q16 (search for similar items in EconPapers)
Date: 2011-07-05
New Economics Papers: this item is included in nep-agr
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www2.vwl.wiso.uni-goettingen.de/courant-papers/CRC-PEG_DP_80.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:got:gotcrc:080

Access Statistics for this paper

More papers in Courant Research Centre: Poverty, Equity and Growth - Discussion Papers from Courant Research Centre PEG Platz der Goettinger Sieben 3; D-37073 Goettingen, GERMANY.
Bibliographic data for series maintained by Dominik Noe ().