Public Investments in Agricultural Research Yield High Returns

Public Investments in Agricultural Research Yield High Returns

May 24, 2011

A new report published by the US Department of Agriculture (USDA) shows that "even though standard economic approaches may be difficult to apply to evaluations of some research benefits of public investments in agricultural research, economic reasoning can provide qualitative analysis even when estimates of benefits are difficult to quantify."

Acknowledging that "assessments of the benefits of Federal research programs pose special challenges relative to determining the gains from other Federal programs," researchers from USDA’s Economic Research Service (ERS) and its Agricultural Research Service (ARS) recently collaborated on a review of available methods for assessing research benefits.  They concluded:

"Relationships between research investments and economic and social impacts are often indirect, with complex outcomes shaped by more than one factor, and often attributable to more than one definable research program. These impacts usually occur after considerable time lags. Economic analysis has shown repeatedly that the payoffs to public investment in agricultural research are large, but precise measurements of the economic benefits of particular research programs may remain elusive or be very costly to obtain. Economic reasoning can help to determine if a research program is addressing public goods, if the economic benefits are likely to be substantial, and if the research is addressing other public functions such as providing scientific support to regulatory or policy initiatives even when the calculation of the exact dollar value of the research is not possible."

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