How Agricultural Biotechnology Boosts Food Supply and Accommodates Biofuel

NBER and University of Chicago Press: Chicago


First-generation agricultural biotechnology is promoted as a tool to improve control of agricultural pests that damage crops and reduce yields. A number of studies have empirically tested the extent to which genetically engineered crops boost farm output by reducing crop damage. They have been limited in size and scope and have generated a wide-range of estimates that vary by country and crop. This paper exploits spatial and temporal variation in the adoption agricultural biotechnology across countries in order to estimate the impact of adoption on food supply. Genetically engineered crops are shown to significantly increase yields on adopting farms at a time when demand for farm output is growing dramatically and traditional sources of yield growth are largely depleted. Econometric estimates are used to paramterize a simple multi-market model to simulate the food price effects of GE seed during the food crisis in 2008. Food prices would have been considerably higher absent the increased supply from agricultural bitoechnology adoption. Demand for new farm land would have also been higher, as would have been the consequent greenhouse gas emissions from land conversion.

Download Working Paper