Technology, production environment, and household income: Assessing the regional impacts of technological change

Mitch Renkow

Agricultural Economics, 1994, vol. 10, issue 3, 219-231

Abstract: This paper clarifies the factors determining the welfare effects of improved agricultural technologies when technology diffusion is unevenly distributed across production environments Household‐level income effects are shown to depend primarily on: (a) whether the economy is open or closed with respect to world markets; (b) whether households are net consumers or net producers of the commodity for which technological change occurs; (c) whether households are adopters or non‐adopters of the new technology; (d) the degree to which labor is mobile across agricultural regions; and (e) government intervention in commodity and/or factor markets. A review of recent empirical work indicates considerable variation in the relative strength of these various factors across countries, and that assumptions regarding the mechanism by which commodity prices are determined – endogenously as in a closed economy, or exogenously as in an open economy – is especially critical.

Date: 1994
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