Sunday, October 15, 2017

Endogenous Growth Models and Stagnation in Agricultural Innovation

See also: Ideas and Research Productivity in Agriculture 

From: Big Ideas Are Getting Harder to Find - Stanford Business Insights:

"big ideas are getting harder and harder to find, and innovations have become increasingly massive and costly endeavors, according to new research from economists at the Stanford Institute for Economic Policy Research. As a result, tremendous continual increases in research and development will be needed to sustain even today’s low rate of economic growth." 

One of the key equations in the paper relates the number of researchers working in an area to the number of new ideas: research productivity = (A*/A)/S(t) = # new ideas / # researchers One particular area they looked at was with productivity in agriculture, measuring ideas as crop yields.

 “For instance, to measure productivity in agriculture, the study’s co-authors used crop yields of corn, soybeans, wheat and cotton and compared them against research expenditures directed at improving yields, including cross-breeding, bioengineering, crop protection and maintenance....On average, research productivity in agriculture fell by about 4% to 6% per year, the study found....Research productivity is simply the ratio of average yield growth divided by the number of researchers." 

They were careful to tease out research related to non-yield related traits. However, is 'yield' always the best way to measure productivity? Maybe it is a good proxy, but it looks like their data really starts in the 60's....about the time when corn seed was being transitioned away from double cross to single cross hybrids, which were more uniform and higher yielding. In terms of having a large marginal impact on yield, that seems like it could be a tough act to follow, even 40+ years later (its not like we will rediscover hybrid vigor or heterosis) no matter how many PhD's we throw at increasing yield. Other developments in crop improvement may in fact be inflating the denominator in the equation above. The convergence of big data and genomics has opened the door to numerous potential lines of research related to crop improvement, that although may only marginally impact yield provide other significant technological benefits to growers, consumers, and the environment. This would be important, even if yield were constant.

Advances in big data and genomics may have resulted in many more possible needles to search for in a much greater number of haystacks than before. Each crop has a different genome and a seemingly infinite number of biochemical pathways that could be of interest. Then there is the micro-biome and who knows what is next. We just need way more researchers than before.

 I'm not sure how much this applies in other fields, and in some ways this could be making the authors' point....look at all the lines and directions of research and scientists pursuing them vs. actual improvements in crop yields. But again, even if yield were constant, for every bushel of corn/soy produced today, how much have we improved with regard to CO2 reduction, energy use, erosion/leaching, reduction in toxic chemical exposure (thanks largely to roundup and Bt traits), and biodiversity (in terms of non-pest targets)?

Yield just seems to be one outcome among many of importance to creating sustainable development in the agriculture space (although it is important enough to sustainability that we certainly would not want to revert back to older technologies, genetics, and chemistries as some have argued). It would be interesting to see this modeled with traits or variety patents or total hybrids as a measure of new ideas.

References:

Are Ideas Getting Harder to Find? By Nicholas A. Bloom, Charles I. Jones, John Van Reenen, Michael Webb. September 2017Working Paper No. 3592

Modern Corn and Soybean Production. Rober G. Hoeft, Emerson D. Nafziger, Richard R. Johnson, and Samuel R. Aldrich. MCSP. First Edition. 2000.

Environmental impacts of genetically modified (GM) crop use 1996–2015: Impacts on pesticide use and carbon emissions. Graham Brookes & Peter Barfoot. GM Crops & Food Vol. 8 Iss.2, 2017 Genetically Engineered Crops: Has Adoption Reduced Pesticide Use?

Agricultural Outlook ERS/USDA Aug 2000 Greenhouse gas mitigation by agricultural intensification Jennifer A. Burneya,Steven J. Davisc, and David B. Lobella.PNAS June 29, 2010 vol. 107 no. 26 12052-12057