Short and long-run returns to agricultural R&D in South Africa, or will the real rate of return please stand up?
| dc.creator | Schimmelpfennig, David | |
| dc.creator | Thirtle, Colin | |
| dc.creator | Zyl, Johan van | |
| dc.creator | Arnade, Carlos Anthony | |
| dc.creator | Khatri, Yougesh | |
| dc.date | 2017-04-01T19:38:58Z | |
| dc.date.accessioned | 2026-07-09T08:12:18Z | |
| dc.description | This paper briefly presents the results of a total factor productivity (TFP) study of South African commercial agriculture, for 1947-1997, and illustrates some potential pitfalls in rate of return to research (ROR) calculations. The lag between R&D and TFP is analyzed and found to be only 9 years, with a pronounced negative skew, reflecting the adaptive focus of the South African system. The two-stage approach gives a massive ROR of 170%. The predetermined lag parameters are then used in modeling the knowledge stock, to refine the estimates of the ROR from short- and long-run dual profit functions. In the short run, with the capital inputs treated as fixed, the ROR is a more reasonable 44%. In the long run, with adjustment of the capital stocks, it rises to 113%, which would reflect the fact that new technology is embodied in the capital items. However, the long-run model raises a new problem since capital stock adjustment takes 11 years, 2 years longer than the lag between R&D and TFP. If this is assumed to be the correct lag, the ROR falls to 58%, a best estimate. The paper draws attention to the possible sensitivity of rate of return calculations to assumed lag structure, particularly when the lag between changes in R&D and TFP is skewed. © 2000 Elsevier Science B. V. All rights reserved. | |
| dc.identifier | doi:10.22004/ag.econ.175526 | |
| dc.identifier | https://ageconsearch.umn.edu/record/175526/files/agec2000v023i001a001.pdf | |
| dc.identifier | http://ageconsearch.umn.edu/record/175526 | |
| dc.identifier.uri | http://hdl.handle.net/123456789/596632 | |
| dc.language | eng | |
| dc.publisher | ||
| dc.source | http://ageconsearch.umn.edu/record/175526 | |
| dc.title | Short and long-run returns to agricultural R&D in South Africa, or will the real rate of return please stand up? | |
| dc.type | Text |