The State Contingent Approach to Farmers' Valuation and Adoption of New Biotech Crops: Nitrogen-Fertilizer Saving and Drought Tolerance Traits

Paul E. Jaramillo, Pilar Useche, Bradford L. Barham and Jeremy Foltz

No 61860, 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado from Agricultural and Applied Economics Association

Abstract: We used a state contingent approach to give a detailed analysis of the uncertainty surrounding seed trait adoption. Our framework emphasizes the role of timing and information in farmers’ adoption decisions. The inherent embeddedness of seed traits results in timing restrictions and the inability of post-planting adjustments, this in turn results in farmers necessarily engaging in a game with nature. Two main types of traits we identify are supplementing traits and stabilizing traits – classification into each category is directly related on the mobility of the production factor the trait intends to substitute. Supplementing traits allow for acting after nature (i.e., ex post) while stabilizing traits are better modeled as acting before nature (i.e., ex ante). The type of trait results in different determinants of the farmers’ WTP function.

Keywords: Crop Production/Industries; Research and Development/Tech Change/Emerging Technologies (search for similar items in EconPapers)
Pages: 39
Date: 2010
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea10:61860

DOI: 10.22004/ag.econ.61860

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