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From Scientific American, September 2007, article "Sowing a Gene Revolution":
All interesting data regarding the effects of innovation in transgenic gene technology on agriculture.
What does this have to do with innovation?
Besides noting that China is apparently pumping tremendous amounts of pesticides in their existing agriculture practices - hence the marginal yield/revenue numbers nonetheless translating into huge profit increases - it is that Argentina and Mexico saw almost all of the benefit eaten by the seed cost.
This latter practice is a modern form of the 'putting out' system - where in medievil Europe, wealthy guilds/individuals would loan looms out to individual weavers. The vast majority of the productivity benefit would then be recaptured by 'rental' or 'maintenance' costs for the loom - sufficient to ensure the lendee would never gain sufficient capital to buy out the loom.
Transgenic crops are a perfect modern equivalent: the individual farmer or even the multinational corporation doesn't have the expertise, resources, or economy of scale (well, MNC's do but no one else) to perform the transgenic research itself. Transgenic crops also can be patented thus keeping out 'natural' competitors, not to mention transgenic crops tend to be just as difficult as modern plants in terms of generating their own next generation seeds.
South Africa is different because of a fortunate combination of university research with the focused aim of public domain transgenics, plus crops which are of little interest to MNC transgenics companies, and lastly sufficient local technology to transplant university strains to commercial.
So, innovation is working in increasing productivity, but there are still plenty of ways this increase can be captured by the greedy.
Code:
Country Seed Pesticide Yield Revenue Profit
Cost Cost
Argentina +530% -47% +33% +34% +31%
Mexico +165% -77% +11% +9% +12%
China +95% -67% +19% +23% +340%
South Africa +89% -58% +65% +65% +299%
India +17% -41% +34% +33% +69%
What does this have to do with innovation?
Besides noting that China is apparently pumping tremendous amounts of pesticides in their existing agriculture practices - hence the marginal yield/revenue numbers nonetheless translating into huge profit increases - it is that Argentina and Mexico saw almost all of the benefit eaten by the seed cost.
This latter practice is a modern form of the 'putting out' system - where in medievil Europe, wealthy guilds/individuals would loan looms out to individual weavers. The vast majority of the productivity benefit would then be recaptured by 'rental' or 'maintenance' costs for the loom - sufficient to ensure the lendee would never gain sufficient capital to buy out the loom.
Transgenic crops are a perfect modern equivalent: the individual farmer or even the multinational corporation doesn't have the expertise, resources, or economy of scale (well, MNC's do but no one else) to perform the transgenic research itself. Transgenic crops also can be patented thus keeping out 'natural' competitors, not to mention transgenic crops tend to be just as difficult as modern plants in terms of generating their own next generation seeds.
South Africa is different because of a fortunate combination of university research with the focused aim of public domain transgenics, plus crops which are of little interest to MNC transgenics companies, and lastly sufficient local technology to transplant university strains to commercial.
So, innovation is working in increasing productivity, but there are still plenty of ways this increase can be captured by the greedy.