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Ex Ante Evaluation of the Economic Impact of Agricultural Biotechnology: The Case of Porcine Somatotropin

1989; Wiley; Volume: 71; Issue: 4 Linguagem: Inglês

10.2307/1242668

1467-8276

Catherine M. Lemieux, Michael K. Wohlgenant,

Global trade and economics

Abstract Introduction of a new growth hormone, porcine somatotropin, will have a significant impact on the U.S. pork industry. Ex ante effects are estimated using a linear elasticity model, which accounts for interrelationships between domestic and international markets for hogs and pork, different adoption rates and lengths of run for supply, and consumer demand shifts from leaner pork. The paper shows how to use experimental data to quantify production function and supply shifts. Results indicate that, for a five‐year adjustment period, producers' surplus will increase between $@@‐@@250 million and $@@‐@@720 million; consumers' surplus will increase between $@@‐@@900 million and $@@‐@@1.95 billion.