How does the project serve stakeholders?

This project serves a diverse range of stakeholders including policymakers engaged in the design and implementation of public policy related to agricultural research and development (R&D) and the adoption and utilization of new agricultural technologies, as well as others who are affected by new agricultural technologies, from farmers and others engaged in the value chains of U.S. agriculture through to American consumers and those who advocate for environmental quality and conservation. Ultimately, every American is a stakeholder in this project.

Agricultural R&D and innovation is essential in several dimensions. It is central to maintaining access to food at reasonable costs in the face of increasing demand, by increasing yields and thus the productivity of our limited land and water resources. R&D and innovation increase product quality and the value-added of agriculture. Innovation reduces the risks and increases the resilience of agriculture in the face of pandemic human, plant, and animal diseases, wildfires, weather events, and trade disruptions.

This project serves its stakeholders by conducting studies of agricultural innovation systems and by developing models and measures of the economic consequences of past and prospective changes in the technologies used on farms and the role of public policy in facilitating those changes. These studies enable the stakeholders in U.S. agriculture to better understand how agricultural R&D contributes to the development and diffusion of new technologies that will help American farmers adapt to changes in their decision-making environments. Understanding and adapting to new technologies is a cross-cutting issue because of the diversity of factors that farmers and other stakeholders in U.S. agriculture face.

Various initiatives at the state, regional, and national level have emphasized the importance of research, extension, and technology transfer in helping farmers adapt to diverse changes they are facing. In this context, stakeholder groups have called for social science research to address various issues related to the economics of agricultural R&D and innovation. These issues can be divided into four broad, yet closely interrelated, areas related to agricultural R&D, innovation, and technology, each with a number of pressing questions:

1. Understanding how R&D, innovation, and new technologies facilitate adaptive responses to change in markets, policies, and the physical environment:
   
   
   
   • How does agricultural R&D and innovation respond to the ever-changing climate, pest, disease, food safety, and biosecurity challenges characterized by the emergence of adaptive dynamics?
   
   
   • How does agricultural R&D and innovation respond to global challenges, such as climate change or pandemics? When and how do private incentives arise for innovation to meet these very public challenges? What is and what should be the role of international public institutions (e.g. CGIAR) in addressing these challenges?
   
   
   • How does agricultural R&D and innovation respond to evolving public perceptions of different of farming technologies and production systems? What is the role of government in regulating those technologies and production systems relative to evolving public perceptions?
   
   
   • How does agricultural R&D and innovation respond to the emergence of new technological opportunities—such as those created by genome editing, precision data collection, or artificial intelligence and machine learning?
   
   
   • How does U.S. agricultural R&D respond to increasing competition from China, India, and Brazil and the increasing size and sophistication of their agricultural R&D and production capacities?
   
   
   • How does agricultural R&D respond to the introduction of new products that substitute for traditional product categories (such as margarine and vegetable shortening in early 20^thcentury, or dairy and meat substitutes today)?
   
   
   
   


2. Understanding the research and development (R&D) institutions and processes that contribute to innovations in food and agriculture:
   
   
   
   • Who is doing R&D and innovation for agriculture and why? What are the returns to R&D? Who is financing R&D? How is the structure of R&D changing, and why?
   
   
   • What are the roles of intellectual property and regulations in incentivizing, constraining, and otherwise shaping both public and privately funded R&D?
   
   
   • How does technology transfer affect the performance of the innovation supply chain, connecting research labs with development (whether in agricultural research stations, start-ups, or corporations), commercialization, marketing, extension, and the demand side of farmers and beyond?
   
   
   
   


3. Understanding the technology adoption and diffusion processes that bring innovations into commercial practice:
   
   
   
   • What determines the adoption and dis-adoption of different technologies? What are potential patterns of spatial and social diffusion?
   
   
   • What are the mechanisms by which technologies are introduced to farmers, whether through extension and private channels? And how effective are they?
   
   
   • How are consumer preferences, public perceptions, and private food industry standards and practices influencing technology adoption upstream by farmers?
   
   
   • To what extent is technological diffusion affected by the growing prevalence of contractual relationships in agriculture?
   
   
   • What are the drivers and barriers of international agricultural technology diffusion?
   
   
   • How does adoption of technologies in foreign markets affect U.S. technology providers as well as U.S. farmers?
   
   
   
   


4. Evaluating the impacts of research and innovation along multiple dimensions:
   
   
   
   • How do we characterize and measure productivity changes? How do we account for non-market or public goods & bads in productivity measures? How important are these aspects and other omissions from the widely used productivity measures?
   
   
   • How are new information technologies and data systems likely to change agricultural value chains? What is the value and ownership structure of emerging data? What is their effect on integration of agricultural value chains?
   
   
   • How much does research contribute to rural development and increase the wellbeing of rural America?
   
   
   • Who are the winners and losers that result when an innovation is introduced? How are those losses absorbed? How might the incidence of losses generate opposition, economically or politically?
   
   
   • How do we understand, measure, and value the impact of new technologies on sustainability and resilience of resources on which agriculture depends?
   
   
   • What are the interacting effects of productivity change and climate change on global food security? What are potential carbon policy impacts on agricultural and food systems? What are potential changes in energy production and energy use by agriculture?
   
   
   
   

These four broad areas of stakeholder demand are intimately interconnected. The diversity of questions across all four share many important themes involving production, markets, the environment, health, and security. Crucially, many stakeholders understand the importance of taking a long-term, integrative, dynamic view of these interrelationships.

The first broad area, on adaptive response, emphasizes those interconnections. A unifying factor is the recognition that agricultural research and innovation play a central role in addressing emerging issues by developing and delivering new technologies that adapt the system of agriculture to meet stakeholder needs. Much applied agricultural R&D is maintenance or adaptive research, for which it is crucial to understand the Red Queen effect, the need for a (crop or livestock) species to be perpetually adapting and evolving, because competing organisms (such as pests and pathogens) do not cease evolving. This effect is accentuated and accelerated by environmental changes, including land use, water availability, climate, biodiversity, etc. Thus, R&D must run faster and faster for the industry just to stay in place. Similarly, R&D initiatives arise in response to temporary or permanent loss of access to input supplies or to important markets—whether due to trade, travel, or immigration disruptions—to develop technologies that increase flexibility in logistics and trading relationships, re-deploying disrupted commercial links, or substituting inputs, enabling the rapid response of value chain structure to mitigate or accommodate the effects of such disruptions on stakeholders. Thus, NC1034 research pays particular attention to the needs, conditions, or factors that induce innovation, and in turn how the resulting innovations causes or enables agriculture to adapt to meet those stakeholder needs. Such feedback or interdependencies are understood to be facilitated both by markets and by public policies. Yet, it is not necessarily a rapid process. It is recognized by stakeholders that there can be long time lags of many years from when research needs are recognized and research funding begins, to when new technologies are first available to farmers. The process of adoption itself can take considerable time and adopted technologies may continue to be used, having impacts on productivity and the environment, for decades. For this reason, changes in R&D are understood to have very long-cycle effects on productivity and economic wellbeing.

Some stakeholders might not realize they cannot take the future availability of a stream of new technologies as a given. Thus, the second broad set of issues is to understand how socio-economic factors affect the R&D institutions and processes that largely account for the supply of innovations and how evolving factors in society change public support for creating and making those technologies available to producers. NC1034 research serves this stakeholder interest by examining how public and private research systems identify demands for and engage in the R&D processes that drive innovation.

The contributions of agricultural research depend not only on the amount of funding, but also on the sources and mechanisms of funding and the organization of the research process. Dramatic changes have been made to the organization and funding of agricultural research that pose challenges and present opportunities. Over the last three decades, the total amount of public funding for agricultural R&D has been shrinking in real terms. The share of state agricultural experiment station (SAES) research funded by state governments has declined, relative to the shares funded by the USDA, other federal agencies and the private sector. This led to the recent development of multi-institute research partnerships between universities, federal labs, and private industries, particularly in the areas of biotechnology and biofuels R&D. The structure and performance of such collaborations merit serious research investigation to inform public policy debates about public-private research partnerships.

In addition to domestic R&D systems in the United States, NC1034 is also concerned with the organization and efficacy of international research and technology transfer in agriculture. This includes the role of traditional public sector sources of research funding and technology transfer such as the World Bank, the CGIAR, and USAID, as well as private foundations such as the Rockefeller Foundation and the Bill and Melinda Gates Foundation. The NC1034 project also increasingly considers the role of private sector R&D around the world, and how competing private interests may shape incentives to innovate or may directly invest new resources in R&D for agriculture.

Stakeholders recognize that simply creating a better mouse trap is not enough. Thus, the third broad issue that stakeholders need to consider is how economic incentives and public policies facilitate or hinder technology adoption and thus the diffusion of those technologies across the economy. The returns to farmers to adopt a new agricultural innovation can be exceedingly different across a range of farm characteristics, and understanding how environmental, economic, and social characteristics influence uptake is key to interpreting and predicting the diffusion of new innovations.  Another critical issue influencing adoption is market acceptance of new technologies, such as seen with biotechnologies. Increasingly, farmers are expected and required to take into account societal attitudes toward their production practices, food industry production guidelines and product standards, and effects of voluntary and mandatory labeling requirements. The NC1034 project examines the direct effects of public perceptions and food industry standards toward farm and food technologies on agricultural producers and consumers as well as the incentives and disincentives they create for technology development and dissemination.

The fourth broad issue important to stakeholders is impact. Foremost this depends upon reliable measurement of the contribution of agricultural innovations to agricultural productivity. Growth of agricultural productivity is necessary to continue to feed the world’s growing population and at the same time conserve increasingly scarce natural resources and adapt to ever more challenging production environments. Productivity is a measure of the amount of agricultural production obtained from a given amount of land, water, and other inputs. It thus directly relates to the amount of resources required to achieve a given amount of production. Productivity growth is thus a fundamental requirement to meet demands for food, fiber, and biofuels without placing undue pressure on land, water, and environmental resources. Key policy questions are: (a) Is productivity growth slowing down and contributing to rising global food prices; (b) what environmental factors are altering rates of productivity growth; and (c) is productivity growth on pace to provide for future global food security? This relates directly to the environmental impacts of agricultural production. Increasingly producer groups are being asked to document their resource “footprints” (e.g. carbon footprint, water footprint) to meet consumer and processor demands for more sustainable production practices.

Finally, stakeholders need common data resources to understand these complex processes. Data on research, adoption, and productivity changes were more readily available when government played a larger role. Increasingly agricultural R&D is carried out by the private sector, and data on private R&D activity and outcomes is often proprietary. Thus, considerable research, data collection, and partnership development is needed to measure the intensity of private sector innovation and its impacts. This requires finding, creating, and collecting data and tracking changes in R&D spending, patenting and licensing, and product testing. Tracking public and private innovation activity (combined with an empirical understanding of the links between them) is critical to assessing whether future productivity will be sufficient to meet future demands while at the same time adapting to increasing sustainability challenges, whether in the form of new pests, new weather patterns, or new market demands.

What is the importance of the work and what would be the consequences if it were not done?

Virtually all of the analyses of agricultural R&D conducted worldwide are based on methods developed by current or past participants of the NC1034 community (or its predecessor committees). NC1034 participants have conducted pioneering work in

• agricultural productivity measurement;


• estimation of the returns to agricultural research;


• assessment of the incidence of the payoff to agricultural research (the insight being that how and when an innovator captures a benefit from what they created can matter just as much if not more than the size of the benefit they capture);


• the determinants and effects of adoption of new agricultural technologies, particularly of biotechnologies and precision agricultural technologies;


• implications of changes in intellectual property rights for U.S. agriculture;


• improved design of biotechnology regulations;


• design of processes for research evaluation, priority-setting, and management;


• design and evaluation of research funding mechanisms and processes; and


• evaluation of the impacts of environmental factors, including various aspects of climate change, on agricultural productivity.

Through such work, members of NC1034 have developed multidisciplinary knowledge about the performance of the research system that has been communicated to policymakers, scientists, farmers, and the public through multiple channels. Publications of group members have been widely cited in policy documents and reports, and NC1034 members regularly serve as committee members for policy advisory groups—such as National Academy of Sciences panels, EPA Science Advisory panels, and IPCC working groups. We regularly respond to requests from federal and state agencies, provide testimony to Congress, and serve as expert witnesses in precedent-setting court cases. Our work is regularly cited in regulatory decisions governing approval and deployment of new agricultural technologies. If the group’s work were not done, some consequences would include:

1. a lack of an objective, data-driven knowledge base to inform public policy debates concerning new agricultural technologies;


2. lack of understanding and appreciation of the contributions to society from agricultural research that benefit both consumers and producers;


3. lack of understanding of barriers to the development and adoption of innovations that drive productivity growth and their consequences;


4. lack of understanding the role of agricultural research in maintaining global food security and U.S. agricultural competitiveness while helping preserve natural resources, landscapes, and environmental quality at home and abroad;


5. Lack of understanding of the full nature of threats to agriculture posed by climate, pest and other evolving factors, along with a lack of knowledge on R&D and technology diffusion strategies to limit those threats.

What is the technical feasibility of the research?

NC1034 members have developed robust methods for evaluating agricultural innovation systems and technologies. The group’s record of accomplishment of significant publications speaks to the feasibility of such methods. Methods developed by this group for agricultural research evaluation and priority setting have been adopted by practitioners worldwide and have received awards from the Agricultural and Applied Economics Association and other professional bodies.

The demands being placed on agricultural innovation systems have expanded over time and so have the NC1034 group’s methods. Members drawn upon and share a variety of novel methods, as problems require. These include applications of agricultural economics, industrial organization, intellectual property analysis, climate science, environmental valuation, quantitative modeling, rural sociology, human health and nutrition, and energy economics.

Given unprecedented recent disruptions in agriculture and the plethora of new actors engaged in the agricultural innovation system, NC1034 intends to seek ongoing feedback from various stakeholders on our research findings and continue to adapt research efforts accordingly. This will be initiated by inviting policymakers, industry leaders, venture capital investors, and others to participate in our research workshops. We will then seek out new opportunities to partner with appropriate stakeholders on specific studies.

What are the advantages for doing the work as a multi-state effort?

NC1034 participants are either agricultural economists, resource economists, or rural sociologists. Most are also part of multi-disciplinary and multi-state research teams addressing important issues in agricultural technology development, adoption, and impact assessment. As part of those multi-state or multi-disciplinary teams, NC1034 participants take the lead in research problems associated with socio-economic causes and consequences of technological change. NC1034 allows participants to share in developing the latest social science and quantitative analytical methods in evaluating returns to agricultural research and the socio-economic impacts of innovations. Further, NC1034 allows participants to take these new evaluation methods back to their state and regional teams and apply them to local problems of interest. NC1034 allows members to benefit indirectly from knowledge gained directly by other members from multi-disciplinary projects. For example, one NC1034 member may gain valuable knowledge from working on a project with weed scientists or entomologists and then convey that to others. Knowledge is thus shared so that social scientists and agricultural scientists may work more effectively together.

Increasingly, agricultural research grants call for comprehensive evaluations of the socio-economic and environmental effects of new technologies and production practices. By continuing to develop cutting-edge evaluation methods, NC1034 members are better able to leverage grant funding and, most significantly, to make major contributions to large multi-state and multi-disciplinary projects. Furthermore, through publications and outreach, threats and opportunities can be conveyed to private and public decision makers altering R&D choices and improving future productivity plus reducing vulnerability.

Adoption of technologies and their impacts spill over across state and international boundaries. While there is a certain value of studying impacts of new technologies in their local contexts, there is also value in the ability to compare and contrast how new technologies affect agricultural producers in different areas and in the identification of areas that may benefit from potential new technologies. Federal agencies, private industry, environmental groups and commodity groups are interested in evaluations of technology and environmental implications for technology that can be scaled-up to commodity-wide or national scale impacts. Multistate collaboration facilitates comparative analyses.

The multi-state community of scholars also provides opportunities for members to economize and achieve synergies through

• the ability to pool resources and share data;


• avoiding redundancy in research activities;


• increasing specialization in and complementarity in research (e.g., one member may work on one aspect of a general problem, while another researcher works on another);


• transfer of analytical methods across research applications;


• cross-pollination of ideas on factors that influence the demand for and impact of technology; and


• transfer of analysis results revealing threats and opportunities to other applicable areas .

Members pool expertise across different production systems and environmental situations. For example, comprehensive evaluation of herbicide-resistant crop varieties requires knowledge of corn, soybean, and cotton production systems not only in a local situation but also different agronomic regions, while modeling climate change-related considerations requires interactions between people who understand the climate issue now and as it is evolving and those who understand regional production systems. Pooling research expertise can help identify commonalities in new technology development and dissemination, as well as regional or crop-specific differences. Another advantage of multistate collaboration is that it can raise awareness of contributions in other fields of research and facilitate acquaintance with other potential research collaborators.

NC1034 has a long and successful history of working with the USDA Economic Research Service. University based participants in NC1034 have worked closely with ERS economists, and indeed ERS economists are active participants of NC1034. ERS has been instrumental in collecting and developing data to measure public and private agricultural R&D and productivity. NC1034 has been an important forum to discuss research methods related to data development, productivity estimation, and technology assessment. Through these forums, state-of-the- art methods for productivity measurement have undergone peer discussions and review.

Finally, NC1034 offers a unique community for mentoring the next generation of experts in the economics of agricultural productivity and innovation. Graduate students and junior faculty from around the United States benefit greatly from opportunities to present their research and receive detailed feedback from more experienced colleagues in a collegial environment. Senior members of the community are enriched by interacting with younger colleagues who often have greater command of technical details in new areas of innovation. Many of the junior and senior members of the NC1034 community describe it as their intellectual home.

What would be the likely impacts from successfully continuing NC1034’s work?

Future contributions will build on previous ones. These contributions will include:

• continued formal and informal communication with stakeholders on these issues through multiple channels;


• policy engagement as evidenced by contributions to National Academy of Sciences panels, EPA Science Advisory Panels, and responses to requests from other federal and state agencies;


• continued contributions to decision-making in the regulation of new technologies in agriculture;


• continued development of multidisciplinary knowledge about the performance of the research system; and


• a continued stream of high-impact publications and other public communications to disseminate and advance that knowledge.

Over the next five years, we envision future research to include studies that:

• continue the tradition of modeling and measuring the consequences of innovation with application not only to conventional agricultural technologies but also to deal with novel aspects of the new generations of genome editing and information technologies;


• develop new models and measures of the implications of the evolving funding structure and management of public agricultural R&D;


• explore the role of innovation in the historical and ongoing structural changes in American agriculture and associated productivity growth;


• develop detailed institutional and quantitative understandings of the causes and consequences of the recent trends in regulation of existing and prospective agricultural technologies


• explore the role of consumer perceptions and demand for genome-edited foods on R&D investment and regulations


• investigate the mechanisms by which technologies are introduced to farmers, both through extension and private channels


• investigate the implications of the growing prevalence of contractual structures in the supply chain for technological diffusion


• explore the impact of venture capital and private equity investment on agricultural R&D


• explore the roles of startups and established firms in innovating new forms of agricultural enterprises, including “vertical farming,” meat substitutes, and cannabis production and marketing.


• valuation of private agricultural input research using new market-based measures and intellectual property information


• explore and analyze models of stewardship and ownership of on-farm data in order to understand their implications for the growth and distribution of productivity gains from precision agriculture data collection


• analyze the impact of adoption of conservation agriculture practices on soil health and resilience and explore the potential of market-based programs to incentivize adoption of conservation practices by agricultural producers


• assess the historical and future effects of climate change on global and US agricultural productivity


• assess R&D needs to address opportunities and potential challenges brought by a changing climate.