n Consultative Group on International Agricultural Research - Study Paper Number 2 2 The International Agricultural Research Centers Their Impact on Spending for National Agricultural Research and Extension Robert E. Evenson *- The International Agricultural Research Centers CGIAR Study Papers No. 1 No. 2 Technological Innovation in Agriculture: The Political Economy of Its Rate and Bias Modem Varieties, International Agricultural Research, and the Poor Plant Genetic Resources: The Impact of the International Agricultural Research Centers Costa Rica and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Guatemala and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Zimbabwe and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Nepal and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Bangladesh and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Brazil and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Indonesia and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research f Their Collaboration in Agricultural Research Ecuador and the CGIAR Centers: A Study o No. 3 No. 4 No. 5 No. 6 No. 7 No. 8 No. 9 No. 10 No. 11 No. 12 No. 13 No. 14 No. 15 No. 16 No. 17 No. 18 No. 19 No. 20 Peru and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Syria and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Cuba and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Philippines and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Thailand and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Gender-Related Impacts and the Work of the International Agricultural Research Centers India and the International Crops Research Institute for the Semi-Arid Tropics: A Study of Their Collaboration in Agricultural Research Burma and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research Chile and the CGIAR Centers: A Study of Their Collaboration in Agricultural Research The Impact of Agricultural Research in Tropical Africa: A Study of the Collaboration between the International and National Research Systems No. 21 Consultative Group on International Agricultural Research CGIAR Study Paper Number 2 2 The International Agricultural Research Centers Their Impact on Spending for National Agricultural Research and Extension Robert E. Evenson The World Bank Washington, D.C. Copyright 01987 The International Bank for Reconstruction and Development/THE WORLD BANK 1818 H Street, N.W. Washington, D.C. 20433, U.S.A. First printing April 1987 All rights reserved Manufactured in the United States of America At its annual meeting in November 1983 the Consultative Group on International Agricultural Research (CGIAR)commissioned a wide-ranging impact study of the results of the activities of the international agricultural research organizations under its sponsorship. An Advisory Committee was appointed to oversee the study and to present the principal findings at the annual meeetings of the CGIAR in October 1985. The impact study director was given responsibility for preparing the main report and commissioning a series of papers on particular research issues and on the work of the centers in selected countries. This paper is one of that series. The judgments expressed herein are those of the author(s). They d o not necessarily reflect the views of the World Bank, of affiliated organizations, including the CGIAR Secretariat, of the international agricultural research centers supported by the CGIAR, of the donors to the CGIAR, or of any individual acting on their behalf. Staff of many national and international organizations provided valued information, but neither they nor their institutions are responsible for the views expressed in this paper. Neither are the views necessarily consistent with those expressed in the main and summary reports, and they should not be attributed to the Advisory Committee or the study director. This paper has been prepared and published informally in order to share the information with the least possible delay. Robert E. Evenson, a specialist in agricultural development, is professor of economics at Yale University. Library o f Congress Cataloging-in-PublicationData Evenson, Robert E. (Robert Eugene); 1934The international agricultural research centers. (CGIAR study paper, ISSN 0257-3148 ; no. 22) Bibliography : p 1. Agriculture--Research--International cooperation. 2. Agriculture--Research--Economic aspects. 3. Agriculture--Research--Government policy. 4 . Consultative Group on International Agricultural Research. 5. Agricultural extension work--Economic aspects. 6. Agricultural productivity. I. Title. 11. Series: Study paper (Cdnsultative Group on International Agricultural Research) ; no. 22. S540.156E94 1987 338.1'6 87-825 7 ISBN 0-8213-0879-3 . Abstract Many C G I A R C e n t e r s h a v e b e e n i n p l a c e f o r a number of y e a r s . I m p o r t a n t c h a n g e s , b o t h i n t h e d e v e l o p m e n t of C G I A R C e n t e r s a n d i n n a t i o n a l r e s e a r c h and e x t e n s i o n programs, have t a k e n p l a c e o v e r t h i s p e r i o d . Two i m p o r t a n t q u e s t i o n s a b o u t t h e i m p a c t o f t h e C G I A R C e n t e r s a r e a d d r e s s e d i n t h i s p a p e r . The f i r s t i s w h e t h e r t h e e x i s t e n c e of t h e C G I A R Centers h a s i n f l u e n c e d t h e s i z e a n d c h a r a c t e r o f n a t i o n a l r e s e a r c h and e x t e n s i o n p r o g r a m s . The s e c o n d i s w h e t h e r t h e r e s e a r c h i n t h e CGIARCenters and t h e n a t i o n a l s y s t e m s h a s h a d a n y i m p a c t on c r o p p r o d u c t i v i t y . The s t u d y e s t i m a t e s t h a t t h e C G I A R Centershave had a p o s i t i v e i m p a c t on i n v e s t m e n t i n n a t i o n a l r e s e a r c h p r o g r a m s i n e a c h of t h e c r o p s f o r w h i c h C G I A R c r o p r e s e a r c h p r o g r a m s e x i s t e x c e p t c a s s a v a . E s t i m a t e s f o r l i v e s t o c k and h o r t i c u l t u r a l c r o p r e s e a r c h p r o g r a m s show a s i g n i f i c a n t p o s i t i v e C G I A R i m p a c t a s w e l l . N a t i o n a l e x t e n s i o n s p e n d i n g i s a l s o s t i m u l a t e d by C G I A R p r o g r a m s . T h e s e e s t i m a t e s a r e b a s e d on a n econometric s p e c i f i c a t i o n t h a t t a k e s i n t o account t h e impact of several economic d e v e l o p m e n t a i d i n i t i a t i v e s i n a d d i t i o n t o t h e a c t i v i t i e s of t h e CGIAR impacts. The s t u d y e s t i m a t e s t h a t C G I A R C e n t e r p r o g r a m s h a v e had s i g n i f i c a n t i m p a c t s on c r o p p r o d u c t i v i t y f o r m a i z e , m i l l e t s , s o r g h u m , r i c e , w h e a t , b e a n s , c a s s a v a and p o t a t o e s i n a l l t h e r e g i o n s s t u d i e d . N a t i o n a l r e s e a r c h programs have had a p o s i t i v e i m p a c t on c r o p p r o d u c t i v i t y i n m o s t o f t h e s e c r o p s a s w e l l . I n a d d i t i o n , n a t i o n a l e x t e n s i o n programs have been p r o d u c t i v e i n some c r o p s . T h e s e e s t i m a t e s a r e b a s e d on c r o p p r o d u c t i o n d a t a i n 25 c o u n t r i e s . vi Acknowledgments I w i s h t o a c k n o w l e d g e t h e r e s e a - r c h a s s i s t a n c e o f M. Ann J u d d and t h e s e c r e t a r i a l a s s i s t a n c e o f L e i l a Adams o f t h e Economic G r o w t h C e n t e r a t Y a l e U n i v e r s i t y . R o b e r t H e r d t , G r a n t S c o b i e and C a r l P r a y p r o v i d e d v a l u a b l e comments. vii Contents 1 A D e s c r i p t i v e Summary of N a t i o n a l a n d I n t e r n a t i o n a l P r o g r a m Development 2 1 Specifying t h e Determinants of Investment i n Research and Extension Econometric Estimates: Investment A n a l y s i s 3.1 Aid D e t e r m i n a n t s - Two-Period Data 3.2 Research and Extension Determinants Two-Period Data 3 . 3 A n n u a l Data A n a l y s i s 11 19 19 25 30 35 3 - 4 5 Policy Implications of Investment Analysis I m p a c t of I n v e s t m e n t o n P r o d u c t i v i t y 5.1 S p e c i f i c a t i o n o f t h e P r o d u c t i v i t y R e l a t i o n s h i p 5.2 P r o d u c t i v i t y I m p a c t E s t i m a t e s Policy Implications of Productivity Analysis 41 41 45 55 59 6 Notes Appendix T a b l e 1: A g r i c u l t u r a l R e s e a r c h E x p e n d i t u r e s a n d Worker Years, b y R e g i o n Appendix T a b l e 2: A g r i c u l t u r a l E x t e n s i o n E x p e n d i t u r e s a n d Worker Years, b y R e g i o n References 61 69 73 1 1 A D e s c r i p t i v e Summary o f N a t i o n a l a n d I n t e r n a t i o n a l Program D e v e l o p m e n t N a t i o n a l i n v e s t m e n t i n a g r i c u l t u r a l r e s e a r c h and e x t e n s i o n p r o g r a m s h a s g r o w n a t a n i m p r e s s i v e r a t e i n t h e p a s t 25 y e a r s . 1 Tables 1 and 2 summarize t h i s i n v e s t m e n t ; d e t a i l e d n a t i o n a l d a t a a r e p r e s e n t e d i n Appendix T a b l e s 1 a n d 2. I t may b e s e e n t h a t , i n 1980 c o n s t a n t d o l l a r s , r e s e a r c h s p e n d i n g i n d e v e l o p i n g c o u n t r i e s i n c r e a s e d from 1 9 5 9 t o 1980 by a m u l t i p l e of 5.8 i n L a t i n America, 6.9 i n A s i a , and 3.6 i n A f r i c a . T h e c o m p a r a b l e s p e n d i n g m u l t i p l e s f o r e x t e n s i o n i n v e s t m e n t were 6.4 i n L a t i n A m e r i c a , 3.5 f o r A s i a , a n d 2.2 f o r Africa. S c i e n t i s t - y e a r (SY) m u l t i p l e s were l o w e r t h a n s p e n d i n g m u l t i p l e s (6.0 f o r L a t i n A m e r i c a , 4.1 f o r A s i a , 4.2 f o r A f r i c a ) , r e f l e c t i n g r i s i n g r e a l c o s t s p e r SY. ( F o r e x t e n s i o n workers t h e m u l t i p l e s were 6.8 f o r L a t i n A m e r i c a , 1.8 f o r A s i a , 2.9 f o r A f r i c a ) . T a b l e 3 s h o w s how r e s e a r c h a n d e x t e n s i o n " s p e n d i n g i n t e n s i t i e s S t t i.e., s p e n d i n g a s a p e r c e n t o f t h e d o m e s t i c v a l u e o f a g r i c u l t u r a l p r o d u c t (G.D.P.) h a s c h a n g e d from 1 9 5 9 t o 1980. T h e s e d a t a show t h a t i n 1959 t h e l o w - i n c o m e and m i d d l e - i n c o m e d e v e l o p i n g c o u n t r i e s were a p p r o x i m a t e l y t w i c e a s s p e n d i n g i n t e n s i v e f o r e x t e n s i o n a s f o r research.2 T h e r e v e r s e was t r u e f o r t h e i n d u s t r i a l i z e d c o u n t r i e s . The r a p i d g r o w t h i n s p e n d i n g i n t e n s i t i e s f o r r e s e a r c h from 1959 t o 1980 c o m b i n e d w i t h l i t t l e o r no g r o w t h i n e x t e n s i o n i n t e n s i t i e s i n t h e 19709, produced roughly e q u a l s p e n d i n g i n t e n s i t i e s f o r research and e x t e n s i o n i n most d e v e l o p i n g c o u n t r i e s . T a b l e 4 p r o v i d e s c o m p a r a b l e d a t a f o r Itworker i n t e n s i t i e s t v ( i . e . r a t i o s o f w o r k e r s t o G.D.P). F o r r e s e a r c h , t h e same g e n e r a l p a t t e r n reflected i n spending i n t e n s i t i e s is reflected i n t h e w o r k e r s i n t e n s i t i e s . B e c a u s e s p e n d i n g p e r SY i s l o w e r i n d e v e l o p i n g c o u n t r i e s 9 t h e y f a r e b e t t e r b y t h i s m e a s u r e . The d i f f e r e n c e between t h e low-income and i n d u s t r i a l i z e d c o u n t r i e s i s much r e d u c e d . 2 Table 1 Agricultural Research Expenditures and W o r k e r s EXPENDITURES (000 Constant 1980 r:S$) WORKERS (Scientist-Years) 1959 KEG1ON / s U B Y J G I ON lq70 1980 1959 1970 1980 Western Europe Northern Europe C e n t r a l Europe Southern Eurqpe 2'14,984 94 ,718 14 1. ,OS4 39,2i2 568 ,284 195,896 372,388 760,466 668,889 91,577 79,556 31,088 34,792 13,676 119,149 20,789 44,333 12,740 41,287 261,114 24 ,427 32,024 9,028 141,469 .54,166 2,063,553 918,634 230 ,135 563,334 125,165 1,282,212 436,094 845,33.8 1,485 ,043 1,221,096 264,037 216 ,018 57,119 1.28,958 29 941 251,s 72 49 703 91,899 49 ,218 60,752 1,205,116 70,676 72,573 37,405 521,971 502,491 5,358,595 1,489,588 409 ,527 6,251 1,818 2,888 I., 54 5 17,701 5,701 12,000 8,445 6,690 1,759 1,4,25 364 570 43i 1,919 12,547 4,409 5,721 2,417 43,709 16,009 19,540 871,233 208,828 1.,492,783 553,490 939,383 1,522,390 1,335,584 386,80G 462,631 80,247 269,443 11 2,941 a, a27 2,08G 8,027 E a s t e r n Europe and USSR 51,6111 20 ,220 31,394 Eastern Europe lis S R North America and Ocearda North Ainerica Oceania L a t i n America T e n p e r a t e South America T r o p i c a l South America CariLbear. and C e n t r a l America 27,700 11,688 i3 ,607 10,305 3,302 8,575 3,113 4,880 1,022 2,698 1,160 8,534 1,527 4,840 2,167 8,088 Africa 424,757 62,033 205,737 75,156 81,827 1,797,894 125,465 130,931 103,249 734,694 643,555 7,390,043 3,849 1,1.22 952 North Africa Vest Lfrica Eaa t Afi-2 ca Southern Africa Asia W e s t Asia Sourh Asia 590 412 221 696 684 1,091 31,837 1,636 2,569 1,692 13 ,720 1.2,250 2,34G 2,466 1,032 1,659 46,655 2,329 5,691 4,102 17,262 17,272 11,418 457 1,433 441 7,837 1,250 47,l.63 S o u t h e o s r Asia East Asia China WORLD TOTAL 108,510 14 8,1339 Sources : Boyce, J . K. and R. E. Evenson, National and I c t e r n a t i o n a l A g r i c u l t u r a l Reseaz-ci: -a n d Jktensio2-Progrsms. (New York.: The A g r i c u l t u r a l Development C o u n c i l , 1375) ; and M. Ann Judd, James I C . Boyce, and Robert E. Evenson, " I n v e s t i n g Ln A g r i c u l t u r a l Supply'' (Discussion Paper No. 442 , Yale U n i v e r s i t y , Economic Growth Center, J-387). 3 Table 2 A g r i c u l t u r a l E x t e n s i o n E x p e n d i t u r e s and Workers EXPENDITURES (000 Constant 1980 US$) ~ WORKERS (Scientist-Year) 1959 REGION/SIJBRZSION 1970 457,G75 187 ,144 199,191 71,340 562 ,935 191,460 371,475 601,950 511,883 90 , 0G 7 205 ,971 1980 514,305 201,366 236 ,834 76 ,105 750,301 2 78 ,149 1959 15,988 4,793 7,865 3,330 29,000 9,340 19,660 13,580 11,50C 2,050 3,353 205 1970 24,388 5,635 13,046 5,704 43,COO 15,749 27,251 15 ,113 12,550 2,563 10,782 1,056 7,591 --? 1980 27,881 6 ,241 14,421 7,219 Western Europe Northern Europe C e n t r a l Europe Southern Europe E a s t e r n Europe and USSR E a s t e r n Europe USSR North A w r i c a and Oceania North America Oceania Latin America Yemperafe South knerica Tropical Sourh America 234,016 13.2 ,983 103,082 17,950 367,329 55,oou 21,546 33,454 14,954 12,235 2,731 22,835 1,232 126 ,624 240,705 383,358 332 ,892 50,466 61,451 5 ,741. 47,296 472,152 760,155 634,201 125,954 396 ,944 4 4 ,379 294,654 44,242 136 ,943 24,786 2,369 779 16,038 5,505 79,875 22,453 23,478 2 : . Caribbean and Central Amerfca Mrica North A f r i c a West Africa East Africa Southern A f r i c a Asia West Asia South fisia Southeast A s i a East ksia China 8,414 237 ,883 57,9 13. 514,671 172,910 204 ,982 106 ,030 30,749 507 ,113 119 ,780 82,194 63,959 241,180 n.n. ' 135 481,096 176,498 181,324 86,096 37,178 412,937 97,315 87 ,727 55,441 172,454 n.a. 2,722,564 28,700 58,700 84,6% 53 ,600 39 ,496 60,153 143,876 28,211 56,422 19,747 39 ,496 n.a. 7,500 14,7SO 9,000 22,309 9,000 113,750 3,200 3,200 86 ,900 142,500 7,030 57,000 9 ,500 13,400 n.a. ,211 3,733 148,780 1.6.535 80,958 33,387 17,3QO n.a. 18,800 74,000 30 ,500 19,200 n.a. WORLD TCTAL Sources: 1,427,913 3,443,489 177,521 294,483 349,331 -and Extensicti Eoyce, J. K. and R. E. Evenson, N a t i o n a l and I nte rnational Agr --i c u l t u r a l %eszarc;i Programs-. (X'ew York: 1he A g r i c u l t u r a l Development Councll, L975) ; aria ri. Ann J.Jdcr, Jaines K. h y c e , axid Roberc E . I:venson, "Lnvesting i n . l g r i c u l t u r a l Supply" ( D i s c c s s i o n P a p e r No. 442, Yale U n i v e r s i c y , Econonic Growth C e n t e r , 1983). 4 Table 3 Research and Extension Expenditures as a Percent of the Value of Agricultural Product Public Sector Agricultural Research Expenditures Subrep;i o n Northern Europe Central Europe SQutbern Europe E a s t e r n Europe Public Sector Agricultural Ex t e n s i o n Expenditures 1980 1.60 1.54 0.74 0.78 0.70 2.83 1.09 0.70 0.98 0.63 0.59 1.19 0.81 1.23 0.47 0.43 0.52 2.44 0.56 1959 0.65 0.29 0.11 0.32 0.28 0.42 0.42 0.07 0.34 0.09 1.27 0.58 0.67 1.64 0.25 0.20 0.24 0.19 1970 1980 0.84 0.45 0.28 0.40 0.35 0.98 0.56 0.43 1.19 0.33 1.71 1.28 1.16 0.46 --- - 1959 I 1970 1.05 1.20 0.61 0.81 0.73 2.24 1.27 0.64 0.67 0.22 0.62 0.61 0.53 1.10 0.37 0.19 0.28 2.01 0.68 0.55 0.39 0.24 0.85 0.42 0.35 0.50 0.43 0.99 0.84 0.39 0.25 0.15 USSR Oceania North America Temperate South America T r o p i c a l South America Caribbean and C e n t r a l America North Africa West Africa E a s t Africa Southern Africa 0.36 0.32 0.76 0.53 0.50 0.71 0.18 2.21 1.24 0.88 0.67 0.31 0.37 0.19 1.13 West Asia South A s i a Sotltheast Asia East Asia China Country Group* Low-Income Developing Hiddle-Income Developing Seni- InGus t r i a l i z e d Indusf ri a l i z e d Plamed Planned e x c l u d i n g China L - 0.18 0.12 0.10 0.69 0.09 0.57 0.23 0.37 0.67 0.51 0.20 0.36 0.85 ".aL n.a. n.a. - - Q.15 0.29 0.29 0.68 0.33 0.45 0.27 0.57 0.54 1.37 0.73 0.75 0.50 0.81 0.73 1.50 0.66 0.73 0.30 0.60 0.29 0.38 - 0.43 1.01 0.5i 0.57 0.44 0.92 - 0.59 0.62 - 0.29 0.33 0.36 *For d e f i n i t i o n of Country Groups see footnote 4. Sources : Appendix Tables l a n d 2 and USDA, Indices of Agricultural Production, various issues. 5 Table 4 R e s e a r c h and E x t e n s i o n Workers R e l a t i v e t o t h e V a l u e of A g r i c u l t u r a l P r o d u c t S Y s p e r 10 M i l l i o n (Constant 1980) Dollars Agricultural Ptoduct E x t e n s i o n Workers p e r 10 M i l l i o n (Constant 1980) Dollars Agricultural Pro duct 1953 2.76 2.19 2.00 2.36 2.26 2.26 1.44 0.26 1970 2.56 2.77 2.76 Subregion North Europe Central Europe Sout liern Europe Eastern Europe 1959 1.05 0.80 0.93 1970 2.01 1.21 1.17 2.97 2.37 2.64 0.89 1980 3.14 1.56 0.96 2.84 2.34 2.43 0.84 1980 2.61 2.73 2.69 1.44 1.38 1.91 0.84 0.46 0.41 0.53 0.91 0.33 0.32 1.90 0.33 0.50 0.47 3.80 0.22 USSR Oceania North A m r j c a Temperate South limcrica 2.88 2.33 2.17 1.31 3.13 2.50 2.11 1.08 1.26 6.46 3.12 22.23 18.08 26.64 5.62 6.54 19.53 19.72 6.13 n.a. Tropical S o t i t h Araerica Caribbean and C e n t r a l America North Africa West Afrj,ca Ens:: A f r i c a Southern A f r i c a West A s i a S o a t 3 Asia S o u t h c x t Asia East Asia 1.15 1.41 0 -86 1.44 0.61 0.77 1.96 0.84 0.65 1.28 5.29 1.66 1.32 1.77 1.20 4.24 1.42 1.76 2.47 0.88 1.29 2.07 5.72 1.49 1.71 0.82 1 . . 1 9 3.95 1.53 28.45 14.01 22.41 5.94 7.25 19.51 13.07 18.83 7.61 16.28 8.73 4.39 20.83 9.81 6.57 n.a. China Country Group Low-Incoint.. D e v e l o p h g Midd le-Inc m e Developiig S m i - I n d u s t r ial-ized Industrialized P1ar.ne d P l a i xe ~ d excluding Ch Lna Appendix Tables 1 and 2. 7.05 n.a. - 0.43 0.69 0.70 1.24 1.02 1.40 0.67 1.31 1.21 1.71 2.27 2.54 1.40 2.40 1.36 1.8s 2.13 18.14 8.89 2.80 2.37 - 18.61 14.68 4.95 2.31 - 20.43 15.98 5.21 2.12 - 2..50 2.29 2.49 - 2.63 Sources: 6 For e x t e n s i o n , t h e p i c t u r e i s q u i t e d i f f e r e n t . By 1 9 5 9 , low-income d e v e l o p i n g c o u n t r i e s h a d a t t a i n e d v e r y h i g h e x t e n s i o n i n t e n s i t i e s ; 5 t o 7 times g r e a t e r than t h o s e a t t a i n e d i n i n d u s t r i a l i z e d c o u n t r i e s . By 1980, w i t h a s l i g h t d e c l i n e i n these i n t e n s i t i e s f o r i n d u s t r i a l i z e d c o u n t r i e s , t h e d i f f e r e n c e was e v e n g r e a t e r . M i d d l e - i n c o m e a n d s e m i - i n d u s t r i a l i z e d countries also increased t h e i r extension i n t e n s i t i e s . T h e s e worker i n t e n s i t i e s s h o u l d n o t be i n t e r p r e t e d a s i f t h e r e were n o d i f f e r e n c e s i n t h e q u a l i t y o f w o r k e r s among c o u n t r i e s . There i s l i t t l e doubt t h a t t h e g e n e r a l levels of t r a i n i n g of b o t h s c i e n t i s t s a n d e x t e n s i o n w o r k e r s v a r y b e t w e e n c o u n t r i e s a n d a r e l o w e r i n t h e d e v e l o p i n g c o u n t r i e s . However, t h e d i f f e r e n c e s a r e n o t a s g r e a t a s i s g e n e r a l l y supposed. There is a l s o l i t t l e i n d i c a t i o n t h a t t h e s e d i f f e r e n c e s have changed a s r e s e a r c h a n d e x t e n s i o n s p e n d i n g h a s i n c r e a s e d . These d a t a d o n o t include Ifextension type" spending a s s o c i a t e d w i t h Rural D e v e l o p m e n t P r o j e c t s i n d e v e l o p i n g c o u n t r i e s . Were s u c h d a t a t o be t a b u l a t e d and i n c l u d e d a s e x t e n s i o n s p e n d i n g , t h e m a g n i t u d e of t h e d i f f e r e n c e s i n s p e n d i n g on e x t e n s i o n r e l a t i v e t o r e s e a r c h i n t h e d e v e l o p i n g c o u n t r i e s would b e e v e n g r e a t e r . Table 5 provides f u r t h e r i n s i g h t i n t o t h e motivation for t h e h i g h e x t e n s i o n worker i n t e n s i t i e s i n d e v e l o p i n g c o u n t r i e s . It shows e x p e n d i t u r e w o r k e r r a t i o s f o r r e s e a r c h a n d e x t e n s i o n . T h e s e r a t i o s i n c l u d e s a l a r i e s o f s c i e n t i s t s and e x t e n s i o n workers and r e l a t e d c o s t s , i n c l u d i n g l a b o r a t o r y c o s t s and t h e c o s t s o f technicians. The r a t i o of r e s e a r c h c o s t s t o e x t e n s i o n c o s t s i s a s much a s 20 t o 1 f o r t h e l o w - i n c o m e d e v e l o p i n g c o u n t r i e s and o n l y 3 t o 1 o r s o f o r t h e i n d u s t r i a l i z e d c o u n t r i e s . Some of t h i s d i f f e r e n c e i s a q u a l i t y d i f f e r e n c e ( e x t e n s i o n workers h a v e q u i t e a d v a n c e d t r a i n i n g i n most i n d u s t r i a l i z e d c o u n t r i e s a n d may have l i t t l e t r a i n i n g i n l o w - i n c o m e c o u n t r i e s ) , a n d some i s d u e t o r e a l cost differences. Many l o w - i n c o m e c o u n t r i e s d o n o t h a v e t h e c a p a c i t y t o t r a i n a g r i c u l t u r a l s c i e n t i s t s and m u s t i n c u r h i g h c o s t s t o t r a i n researchers and t o purchase s c i e n t i f i c equipment. 7 Table 5 E x p e n d i t u r e s p e r S Y / E x t e n s i o n Worker Research Espenditures per SY (000 Constant Extension Espenditures per Exterision Worker (000 Constant RegiodSubregion Westerit Europe Northern Europe Central Europe Southern Europe Eastern Europe & USSR Eastern Europe USSR North h e r f.ca and Oceania hTar::h ih.crica Oceania 1980 US$) 1959 1970 73 52 98 52 29 1980 US$) 1980 76 1959 15 24 13 5 13 1970 19 1980 44 52 18 32 16 11 49 25 51 99 78 29 27 33 15 33 32 34 31 13 27 31 127 30 127 14 12 25 12 14 40 14 13 14 51 52 46 90 100 52 142 85 130 117 54 23 24 43. 35 Latin America I'ei;npcrate Sout.h America Tropical S o u t 3 .b.erica Caribbean and Central America Africa N~r:th Afr i z r West; Africa F,asl: Mrica Soa.tltern Africa Asia SG 65 61 28 62 44 56 28 19 42 18 18 49 26 53 56 52 28 20 11 34 1 . 8 11. 12 8 35 108 58 59 23 53 22 20 65 44 97 72 56 53 27 83 46 50 8 11 G 4 19 2 6 8 7 12 8 5 12 4 8 38 39 54 34 25 3 3 !Jest A s i n South A s h - Sout he as t Asia Ea C . A *. Cis ia ChiEd 1s 4[I 28 22 32 4 1 2 43 3 5 1 2 9 7 1 2 14 couritry Croup Low- Inc o m i)cv e lo p in g E1id.d1c -L:i , :cme L,ev e 1op i:i 5 Sem j. Ir.d us t r i a i ized Itid u s t r i n 1i zed 4 2nnned P l a i r w d e s c i c d i n z Chins Soci-ces : See.Ta.bles 1 2nd 2. 34 42 41 40 44 45 80 32 25 47 47 46 93 31 30 3 2 7 10 25 7 2 6 10 16 11. 29 55 33 31 - - - 1.3 13 14 8 T a b l e 6 r e p o r t s d a t a on s p e n d i n g by commodity i n t h e f o r m o f spending intensities. W i t h few e x c e p t i o n s , d e v e l o p i n g c o u n t r i e s c a n n o t p r o v i d e a c o m m o d i t y breakdown f o r t h e i r r e s e a r c h s p e n d i n g . They do well t o p r o v i d e d a t a o n t o t a l s p e n d i n g . It is possible, h o w e v e r , t o o b t a i n p u b l i c a t i o n s d a t a f r o m t h e CAB A b s t r a c t system by c o m m o d i t y o r i e n t a t i o n . T h i s was d o n e f o r e a c h o f 25 c o u n t r i e s f o r t w o p e r i o d s 1972-75 and 1976-80. T h e s e d a t a were t h e n standardized i n t o equal c o s t u n i t s u t i l i z i n g B r a z i l i a n data. For B r a z i l r e a l s p e n d i n g b y c o m m o d i t y a n d CAB p u b l i c a t i o n s d a t a were a v a i l a b l e . I t was t h u s p o s s i b l e t o s t a n d a r d i z e p u b l i c a t i o n s i n t o c o s t e q u i v a l e n t u n i t s . S t a n d a r d i z e d p u b l i c a t i o n s were t h e n used t o a l l o c a t e a c t u a l e x p e n d i t u r e s t o commodities. The d a t a show t h a t s p e n d i n g i n t e n s i t i e s d i f f e r g r e a t l y by c o m m o d i t y i n t h e 25 c o u n t r y s a m p l e ( t h e s e 25 c o u n t r i e s a c c o u n t f o r a p p r o x i m a t e l y 90 p e r c e n t o f t o t a l p r o d u c t i o n i n d e v e l o p i n g c o u n t r i e s , e x c l u d i n g China). Spending i n t e n s i t i e s a r e low f o r c o c o n u t s , sweet p o t a t o e s and c a s s a v a and h i g h f o r c o c o a , c o f f e e a n d l i v e s t o c k . The t a b l e a l s o s h o w s t h a t t h e I A R C s a c c o u n t f o r r e l a t i v e l y l o w s h a r e s of t h e t o t a l r e s e a r c h e x p e n d i t u r e s o n t h e c o m m o d i t i e s t h e y work on. S i n c e e x p e n d i t u r e s per SY a r e v e r y h i g h i n t h e I A R C s ( a b o u t 4-6 times t h e a v e r a g e f o r n a t i o n a l s p e n d i n g ) , t h e I A R C s a r e much l e s s s i g n i f i c a n t i n terms o f t h e i r share o f s c i e n t i f i c personnel devoted t o these commodities. T a b l e 7 r e p o r t s t h e CAB p u b l i c a t i o n s d a t a i n t h e f o r m o f r a t i o s o f " b a s i c " t o " a p p l i e d " research. A b s t r a c t i n g j o u r n a l s a r e c l a s s i f i e d a s t o whether t h e y are o r i e n t e d t o r e l a t i v e l y b a s i c reseach f i e l d s o r t o r e l a t i v e l y applied f i e l d s (see t h e notes t o the table for t h e classification). While t h i s p r o c e d u r e i s v e r y c r u d e it d o e s p r o v i d e a b a s i s f o r comparing t h e research p r o g r a m s o f d e v e l o p i n g c o u n t r i e s w i t h t h e research p r o g r a m s o f d e v e l o p e d c o u n t r i e s . The t a b l e s h o w s t h a t t h e 25 d e v e l o p i n g c o u n t r i e s h a v e s l i g h t l y h i g h e r r a t i o s of b a s i c t o a p p l i e d r e s e a r c h on c r o p s and s u b s t a n t i a l l y h i g h e r r a t i o s o f b a s i c t o a p p l i e d r e s e a r c h on a n i m a l s . 9 Table 6 Research as a Percent of t h e V a l u e of Product, by Commodity, Average 1972-79 Period, 25 Countries REGION COMlWDlTY Wheat Rice Africa 1.30 1.05 Asia Latin America 1.04 0.41 0.18 0.23 0.48 0.68 0.19 0.60 0.57 1.57 0.43 0.19 1.13 0.64 0.92 0.60 0.10 0.67 0.60 1.12 A 11 Countries 0.51 0.25 0.23 0.21 0.27 1.06 0 .ll 0.32 0.52 1.69 0.29 0.07 Spending by International Centers 0.02 0.02 0.03 Ratio IARC Spending to Total 0.04 0.07 0.32 0.21 0.21 0.17 0.13 2.33 0.06 0.08 0.51 14.17* Maize Cotton Sugar Soybeans Cassava F i e l d Beans Citrus Cocoa Potatoes Sweet P o t a t o e s Vegetables Bananas Coffee Groundnut Coconut Beef Pork Poultry Gther Livestock 0.44 0.23 1.06 23.59* 0.09 1.65 0.88 2.75 0 .ll 0.02 0-04 i 0.15 0 .ll 0.08 0.21 0.21 0.06 1.56 0.27 3.12 (3.57 0.07 0.19 0.08 0.41 0.20 1.25 0.12 0.03 0.73 0.27 1.18 0.005 - 0.02 0.25 0.04 1.36 1.25 1.64 0.02 0.02 0.02 0.02 1.82 0.65 0.39 0.32 0.89 2.56 1.99 1.81 0.42 0.71 - - Sources: M. Ann Judd, James K. Bovce, and Robert E. Evenson, " I n v e s t i n g i n A g r i c u l t u r a l Supply" (Discussion P a p e r No. 442, Yale U n i v e r s i t y , Economic Growth Center, 1983); and USDA, I n d i c e s of A g r i c u l t u r a l Production, v a r i o u s i s s u e s . (*) R a t i o s are high because production i s very low. 10 Table 7 R a t i o s of B a s i c to A p p l i e d Research ~ ~~ ~~ Crop Research A n i m a l Research 1972-75 Argentina 1976-79 .16 .19 .13 .17 .10 1980-83 .08 .17 .14 .22 .07 1972-75 1976-79 1980-83, .90 .91 .13 .18 .13 .33 .66 .38 .34 .32 .59 .97 .47 .61 .61 .15 .95 .48 Brazil Chile Colombia Mexico Peru Venezuela Ghana Kenya Nigeria Sudan Tanzania Tunisia Uganda Egypt Sri Lank India Indonesia South Korea Malays i a Pakistan Philippines Taiwan Thailand Turkey .59 .90 .90 .44 1.40 .53 .96 .64 .15 .16 .25 .18 .12 .49 .14 .07 .16 .26 .12 .23 .51 .12 .18 .19 .13 .13 .07 .25 .23 .15 .14 .12 .04 .09 .71 .22 .04 .07 .32 .58 .59 .53 1.11 1.18 .60 1.11 .05 .06 .16 .09 .93 .57 .29 .30 .33 .29 .64 .58 1.07 .36 .51 2.10 1.79 .10 .14 .08 .21 .23 .16 .09 .26 .97 .41 , .36 .50 .26 .38 .43 .61 .51 .27 .10 .43 .92 .05 .14 .08 .19 .17 .09 .15 .21 .08 .16 .43 .61 .43 .37 .42 1.97 .22 .10 .19 .43 .30 .30 2.68 .15 .17 .17 .29 .16 .27 .18 .28 .76 1.37 .47 .37 .41 .18 .16 .40 .73 .52 .34 .so .54 .30 25 Developing C o u n t r i e s .22 .15 .21 .16 All Developed C o u n t r i e s Note: .23 R a t i o s are based on c o u n t s of a b s t r a c t e d p u b l i c a t i o n s by class o f j o u r n a l d e f i n e d as f o l l o w s . Basic Crop J o u r n a l : H e l m i n t h o l o g i c a l A b s t r a c t s (B) ; Rev. P l a n t P a t h o l o g y Applied Crop J o u r n a l s : F i e l d Crops A b s t r a c t s , Herbage A b s t r a c t s , H o r t i c u l t u r a l A b s t r a c t s , Review of Applied Entomology, S o i l s and F e r t i l i z e r s , Wood Abstracts. Basic Animal J o u r n a l : H e l m i n t h o l o g i c a l A b s t r a c t s , P r o t o z o o l o g i s t Xbstracts, Review of Med. & Vet. 1 Mycology Applied Animal J o u r n a l s : Animal Breeding A b s t r a c t s , Dairy S c i e n c e A b s t r a c t s , N u t r i t i o n A b s t r a c t s ( l a n d and f e e d i n g ) , Rev. Applied Entomology (A), V e t . B u l l e t i n and Index V e t . ~ 11 2 Specifying t h e Determinants of Investment i n Research and E x t e n s i o n If I A R C i m p a c t s on n a t i o n a l r e s e a r c h a n d e x t e n s i o n s p e n d i n g a r e t o be m e a s u r e d , a s p e c i f i c a t i o n r e l a t i n g n a t i o n a l s p e n d i n g t o " d e t e r m i n a n t s , " i n c l u d i n g I A R C i n v e s t m e n t , i s r e q u i r e d . Such a s p e c i f i c a t i o n should be c o n s i s t e n t w i t h economic l o g i c and p o l i t i c a l r e a l i t y . S i n c e I A R C i n v e s t m e n t s a r e commodity based, it i s n a t u r a l t o d e v e l o p t h e s p e c i f i c a t i o n f o r s p e n d i n g by commodity. The s p e c i f i c a t i o n d e v e l o p e d h e r e i s m o t i v a t e d b y a p r o j e c t e v a l u a t i o n o r p l a n n i n g p e r s p e c t i v e m o d i f i e d by p o l i t i c a l constraints. The s p e c i f i c a t i o n i n c l u d e s v a r i a b l e s t h a t a r a t i o n a l p l a n n e r would u s e t o g u i d e o p t i m a l i n v e s t m e n t . I t a l s o i n c l u d e s v a r i a b l e s t h a t r e f l e c t t h e p o l i t i c a l power o f i n t e r e s t g r o u p s and p o l i t i c a l c o n s t r a i n t s . Before d i s c u s s i o n o f t h e s p e c i f i c a t i o n i t w i l l be u s e f u l t o d i s c u s s t h e d a t a t o be u t i l i z e d and t o l i s t t h e v a r i a b l e s i n t h e d a t a . Two d a t a s e t s h a v e b e e n c o n s t r u c t e d . T h e f i r s t i s a d a t a s e t where t h e o b s e r v a t i o n s a r e f o r t w o p e r i o d s , 1972-75 and 1976-80 f o r 24 c o ~ n t r i e s . ~ For t h i s data s e t i t was p o s s i b l e t o o b t a i n a i d v a r i a b l e s , t h u s a l l o w i n g a t e s t of t h e r o l e o f a i d i n i n f l u e n c i n g n a t i o n a l s p e n d i n g . The s e c o n d d a t a s e t i s f o r t h e same c o u n t r i e s , f o r a r e d u c e d s e t of v a r i a b l e s m e a s u r e d a n n u a l l y f o r t h e 1962-82 p e r i o d . The o b s e r v a t i o n s i n b o t h d a t a s e t s a r e o n c o m m o d i t i e s (i.e., a n o b s e r v a t i o n i s f o r a c o m m o d i t y , a c o u n t r y and a y e a r ) ( o r a n a v e r a g e of 1972-75 o r 1976-80 f o r t h e f i r s t d a t a s e t ) . The f i e l d crop commodities a r e rice, wheat, maize, sorghum, m i l l e t s , c a s s a v a , f i e l d b e a n s , p o t a t o e s , sweet p o t a t o e s , g r o u n d n u t s , s u g a r and soybeans, l i v e s t o c k and h o r t i c u l t u r a l c r o p s i n c l u d e b a n a n a s p c o f f e e , c o c o n u t , beef, p o r k , p o u l t r y and o t h e r l i v e s t o c k . 12 Table 8 provides a l i s t o f t h e v a r i a b l e s f o r t h e two d a t a s e t s w i t h a s h o r t d e f i n i t i o n of t h e v a r i a b l e . Those v a r i a b l e s marked w i t h an a s t e r i s k a r e m e a s u r e d on a c o u n t r y r a t h e r t h a n a c o m m o d i t y b a s i s . T h a t is, t h e y a r e common t o a l l c o m m o d i t i e s ( a c c o r d i n g l y ' t h e i r means a r e n o t c o m p a r a b l e t o t h e means o f v a r i a b l e s a c t u a l l y m e a s u r e d on a commodity b a s i s ) . The v a r i a b l e s a r e c l a s s i f i e d a s e n d o g e n o u s , i.e., t h e c h o i c e v a r i a b l e s b e i n g s u b j e c t t o a n a l y s i s , p a r t i a l l y e n d o g e n o u s , and exogenous. The exogenous v a r i a b l e s a r e f u r t h e r c l a s s i f i e d a s "economic" v a r i a b l e s , " i n t e r n a t i o n a l t r a n s f e r " v a r i a b l e s , It p o l i t i c a 1 -economic I' v a r i a b l e s . and The dependent v a r i a b l e s i n t h e a n a l y s i s a r e t h e v a r i a b l e measuring n a t i o n a l r e s e a r c h spending and n a t i o n a l e x t e n s i o n spending. RESEXP ( m e a s u r e d i n m i l l i o n s o f 1980 d o l l a r s ) . EXTEXP ( m e a s u r e d i n m i l l i o n s o f 1980 d o l l a r s . is n o t measured on a commodity b a s i s ) . This variable The model by w h i c h t h i s s p e n d i n g i s d e t e r m i n e d i s c o n s t r u c t e d i n s t a g e s . The f i r s t s t a g e i s m o t i v a t e d by s u p p o s i n g t h a t a p l a n n e r i s a t t e m p t i n g t o maximize t h e economic s u r p l u s , (i.e., b o t h c o n s u m e r s ' a n d p r o d u c e r s ' s u r p l u s ) a s s o c i a t e d w i t h t h e research o r e x t e n s i o n program. I n t h e second s t a g e t h e planner t a k e s i n t e r n a t i o n a l transfer c o n d i t i o n s i n t o account. I n t h e t h i r d , t h e p l a n n e r takes p o l i t i c a l c o n s t r a i n t s i n t o account. ( T h i s i s t h e r a t i o n a l e f o r t h e c l a s s i f i c a t i o n o f exogenous variables i n Table 8). B e f o r e d i s c u s s i n g t h e s e v a r i a b l e s , i t s h o u l d be n o t e d t h a t s e v e r a l a i d v a r i a b l e s , A I D , NDONORS, WBEXTt WBRES, "STAFF, and I N T C R a r e a l s o i n c l u d e d i n t h e model. These c a n n o t be c o n s i d e r e d t o be exogenous determinants o f n a t i o n a l s p e n d i n g , however, since a c t i o n s by t h e r e c i p i e n t c o u n t r i e s a s well a s c h o i c e s b y d o n o r s 13 Table 8 Variables Dictionary: Research and Extension Investment Analysis 1972-79 1976-80 Data Mean Std. Dev. I. Endogenous (Choice) Variables RESEXP: Annual Spending (millions of 1980 dollars) by Commodity on Research EXTEXP: Annual Spending (millions of 1980 dollars on Extension (all commodities) 11. Partially Endogenous Variables 1962-82 Data Mean Std. Dev. .9819 30.68 2.24 41.95 0.69 26.50 1.70 39.60 AID: Value of Aid from all Sources (millions of 1980 dollars) NDONORS: The Number of Donors Providing Aid to Research WBRES: World Bank Supported Research Programs (including national commodity) WBEXT: World Bank Supported Extension Programs (including national components) "STAFF: Number of IARC Scientists in Countries Other than IARC Host Countries INTCR: Number of Joint IARC-Joint IARC-National Research Collaborative Research Agreements BASIC: Ratio of Non-commodity Oriented Research to Commodity Research (See Table 7) CONGRU: A Measure of Congruence Between Research Spending and Commodity Value 2 CONGRU = 1 - C (Vi-Ci) where Vi is research share, C. is 1 Commodity share 111. Exogenous Variables A. Economic PROD: Value of Commodity Production (millions of 1980 dollars) DIVER: Inverse of the Sum of Squared Shares of Production in Commodity Geo-Climate Combinations EXPRAT: Ratio of Expenditures per SMY to Expenditures per Extension Worker ARABLE: Ratio of Arable Land in the Current Period to Arable Land Six Years Earlier CINTSP: Cumulated Research Expenditures on the Commodity in IARCs (millions of 1980 dollars) 25.00 4.92 10260 10383 3.88 27 17.67 2.93 93445 67300 3.52 n.a. n.a. * 1.44 6.84 .13 24.97 .85 223.34 0.4118 10.14 1.09 653.63 .21 9.99 .11 2113.62 0.39 9.44 1.05 4580.59 8452.20 0.20 9.10 0.10 10148.80 6.17 13.78 (Table continued on the following page.) 14 T a b l e 8 V a r i a b l e s D i c t i o n a r y : R e s e a r c h and E x t e n s i o n Investment Analysis (continued) 1972-75, 1976-80 Data Mean Std. Dev. 1962-82 Data Mean Std. Dev. B. International Transfer RESNSR: Research Scientist Manyears on the Commodity by Neighboring Countries in Similar Geo-climate Regions (millions of 1 9 8 0 dollars) INTLOC: A Dummy Variable = 1 if the Country is Hosting the IARC Undertaking Research on the Commidity TOTALAREA: Total in Crops in the Country (000 ha) 8.67 12.61 5.14 7.60 .019 10715.19 .14 20902.44 n.a. 10740.77 21558.60 C. Political - Economics 16.39 24.46 71.68 100.75 IMPORTS: Value of Imports of the Commodity (millions of 1 9 8 0 dollars) EXPORTS: Value of Exports of the Commodity (millions of 1 9 8 0 dollars) UREARICE: Ratio of Prices Paid by Farmers for Urea Fertilizer to Prices Received for Rice ECONAG: Percent of Economically Active Population Working in Agriculture URBANPOP: Percent of the Total Population Living in Urban Areas of 100,000 Population or More VIOLD: Percent of Population Killed in Domestic Political Violence in Past Decade n.a. n.a. 2.76 56.62 1.70 20.20 2.74 54.45 1.61 19.77 34.53 21.58 32.05 21.10 .12 ( - 1 0 ) .12 ( - 9 ) 0.00 0.00 D. Other A Dummy Variable = 1 if time Period is 1 9 7 2 - 7 5 R1: A Dummy Variable = 1 if Country is Located in Asia R2: A Dummy Variable = 1 if Country is Located in Africa T1: 0.05 0.4 0.32 0.5 0.49 0.47 n.a. n.a. n.a. 15 responding t o characteristics of r e c i p i e n t c o u n t r i e s determine t h i s spending. Thus t h e s e a i d v a r i a b l e s must be r e g a r d e d t o be s i m u l t a n e o u s l y d e t e r m i n e d a l o n g w i t h n a t i o n a l s p e n d i n g . (See t h e following s e c t i o n for a discussion of t h e econometric treatment.) Now c o n s i d e r t h e f i r s t s t a g e o f t h e p l a n n e r ' s p r o b l e m . A g i v e n r e s e a r c h p r o g r a m c a n b e expected t o lower p r o d u c t i o n c o s t s per u n i t o f p r o d u c t i o n . The more u n i t s o v e r w h i c h c o s t s c a n be lowered, t h e h i g h e r t h e o p t i m a l l e v e l of research. Each commodity and each geo-climate r e g i o n p r e s e n t d i f f e r e n t r e s e a r c h p r o b l e m s t o some degree. Hence u n i t s of p r o d u c t i o n s h o u l d b e m e a s u r e d on a c o m m o d i t y - r e g i o n b a s i s . T h e two v a r i a b l e s PROD ( p r o d u c t i o n ) a n d D I V E R ( d i v e r s i t y ) ( a n d t h e i n t e r a c t i o n of t h e s e two v a r i a b l e s ) a r e d e s i g n e d t o p i c k u p t h e s e effect^.^ N a t i o n a l r e s e a r c h s p e n d i n g i s expected t o r i s e a s b o t h p r o d u c t i o n a n d d i v e r s i t y increase. F o r some ( p e r h a p s m o s t ) r e s e a r c h p r o g r a m s a "minimum c r i t i c a l mass" of research e f f o r t may be r e q u i r e d f o r a n e f f e c t i v e program. If s o t h e r e w i l l b e a t h r e s h o l d l e v e l o f p r o d u c t i o n b e l o w w h i c h a r esear ch p r o g r a m c a n n o t be j u s t i f i e d . Small diverse c o u n t r i e s a r e more l i k e l y t h a n l a r g e r c o u n t r i e s t o f a c e t h e s e problems. T h e v a r i a b l e s EXPRAT and ARABLE a r e p r i c e v a r i a b l e s r e f l e c t i n g p r i c e s of a l t e r n a t i v e s o u r c e s o f g r o w t h i n s u p p l y . EXPRAT, t h e r a t i o o f e x p e n d i t u r e s p e r S Y t o expenditures per e x t e n s i o n w o r k e r , i s d e s i g n e d t o r e f l e c t t h e r e l a t i v e c o s t s of pursuing growth through e x t e n s i o n investment. ( E x p r e s s i n g it i n r a t i o terms a v o i d s t h e n e e d t o s p e c i f y a n e x c h a n g e rate.) I t i s expected t h a t when t h e p r i c e o f r e s e a r c h r e s o u r c e s f a l l s r e l a t i v e t o e x t e n s i o n r e s o u r c e s more s p e n d i n g i n r e s e a r c h w i l l t a k e p l a c e . The ARABLE v a r i a b l e ( t h e r a t i o of a r a b l e l a n d c u r r e n t l y t o a r a b l e l a n d 6 y e a r s p r e v i o u s l y ) i s d e s i g n e d t o r e f l e c t t h e p r i c e of s u p p l y g r o w t h v i a l a n d e x p a n s i o n . When t h e c h a n g e i n a r a b l e l a n d 16 i s s m a l l , r e f l e c t i n g l a n d e x h a u s t i o n , m o r e s p e n d i n g on r e s e a r c h is expected. Now t u r n t o t h e second s t a g e o f t h e p r o b l e m . T h e p l a n n e r r e c o g n i z e s t h a t t e c h n o l o g y may " s p i l l - i n " from o t h e r c o u n t r i e s and from IARCs. H e a l s o r e c o g n i z e s , however, t h a t t h e p o t e n t i a l s p i l l - i n t e c h n o l o g y was d e s i g n e d f o r o r "targeted" t o g e o - c l i m a t e c o n d i t i o n s i n o t h e r c o u n t r i e s . O t h e r n a t i o n a l p r o g r a m s w i l l be t a r g e t i n g t h e i r r e s e a r c h p r o g r a m s t o t h e i r own g e o - c l i m a t e c o n d i t i o n s . The I A R C s may t a r g e t t o a b r o a d e r r a n g e o f conditions than a r e extant i n their host countries, but i n p r a c t i c e they lack t h e resources t o provide technology targeted t o more t h a n a l i m i t e d r a n g e o f e n v i r o n m e n t s . Thus, t h e p l a n n e r w i l l f i n d t h a t some t e c h n o l o g y a v a i l a b l e on t h e i n t e r n a t i o n a l m a r k e t is d i r e c t l y s u i t e d t o u s e (i.e., i t i s t a r g e t e d t o d o m e s t i c c o n d i t i o n s b u t t h a t much new t e c h n o l o g y ( a n d r e l a t e d r e s e a r c h f i n d i n g s ) i s " m i s m a t c h e d , " i.e.? i t i s t a r g e t e d t o geoc l i m a t e c o n d i t i o n s d i f f e r i n g from t h o s e of t h e country. It is h y p o t h e s i z e d t h a t t h e p l a n n e r ' s r e s p o n s e t o c l o s e l y matched t e c h n o l o g y from a b r o a d w i l l be t o r e d u c e d o m e s t i c r e s e a r c h investment since d o m e s t i c r e s e a r c h i s a s u b s t i t u t e f o r matched t e c h n o l o g y from a b r o a d ( e x t e n s i o n s p e n d i n g may b e i n v e r s e d ) . Likewise, t h e p l a n n e r ' s r e s p o n s e t o mismatched technology from a b r o a d may b e t o i n c r e a s e d o m e s t i c r e s e a r c h i n v e s t m e n t s i n c e t h i s m i s m a t c h e d t e c h n o l o g y o f f e r s d o m e s t i c r e s e a r c h e r s an o p p o r t u n i t y f o r m o d i f i c a t i o n a n d a d a p t a t i o n of t h e m i s m a t c h e d t e c h n o l o g y t o d o m e s t i c c o n d i t i o n s . Of c o u r s e , i f t h e m i s m a t c h i s t o o g r e a t i t w i l l not o f f e r such opportunities. W e would t h e n e x p e c t p l a n n e r s t o e x h i b i t a m i x e d r e s p o n s e t o technology from abroad. On t h e o n e h a n d , t h e y w i l l " f r e e r i d e " on t h e r e s e a r c h o f I A R C s a n d n e i g h b o r i n g c o u n t r i e s t o t h e e x t e n t t h a t t h e y see t h e s e r e s e a r c h u n i t s a s p r o d u c i n g c l o s e l y m a t c h e d technology with l i t t l e scope f o r adaptation. On t h e o t h e r h a n d , t h e y w i l l r e s p o n d w i t h increased a d a p t i v e r e s e a r c h t o t h e e x t e n t t h a t t h e y see t h e s e u n i t s p r o d u c i n g m i s m a t c h e d t e c h n o l o g y 17 o f f e r i n g a d a p t a t i o n o p p o r t u n i t i e s and t o t h e e x t e n t t h a t t h e s e u n i t s a r e producing "pre-technology" s c i e n t i f i c d i s c o v e r i e s t h a t a l s o e n h a n c e t h e p r o d u c t i v e n e s s o f t h e i r own systems. The v a r i a b l e s CINTSP ( c u m u l a t e d s p e n d i n g i n I A R C s on t h e c o m m o d i t y ) and RESNSRB (SYs w o r k i n g on t h e c o m m o d i t y i n geoc l i m a t e neighboring c o u n t r i e s ) a r e measures o f t h e programs t h a t a n a t i o n a l p l a n n e r w i l l respond to. Whether t h e r e s p o n s e w i l l b e a net n e g a t i v e free-riding response o r a n e t p o s i t i v e a d a p t i v e o p p o r t u n i t y r e s p o n s e d e p e n d s on t h e n a t u r e o f t h e t e c h n o l o g y . The v a r i a b l e T O T A L A R E A i s a m e a s u r e o f t h e s i z e o f t h e c o u n t r y and t h e i n t e r a c t i o n o f t h i s v a r i a b l e w i t h CINTSP i s d e s i g n e d t o i d e n t i f y whether t h e response t o I A R C i n v e s t m e n t d i f f e r s f o r l a r g e a n d small c o u n t r i e s . F i n a l l y r t h e planner w i l l respond t o p o l i t i c a l c o n s t r a i n t s . The v a r i a b l e s IMPORT a n d EXPORT m e a s u r e t h e e f f e c t s of i n t e r n a t i o n a l t r a d e . Most c o u n t r i e s i m p l i c i t l y p l a c e a h i g h e r v a l u e on i n t e r n a t i o n a l e x c h a n g e t h a n on d o m e s t i c p r o d u c t i o n . A u n i t of p r o d u c t t h a t s a v e s o r e a r n s f o r e i g n e x c h a n g e is v a l u e d more h i g h l y t h a n o n e t h a t d o e s n o t . A p l a n n e r w i l l r e s p o n d t o t h i s by i n v e s t i n g more i n r e s e a r c h on c o m m o d i t i e s t h a t s a v e o r e a r n f o r e i g n exchange. Many c o u n t r i e s i n t e r v e n e i n a g r i c u l t u r a l markets. The U R E A R I C E v a r i a b l e ( t h e r a t i o o f p r i c e s p a i d f o r urea f e r t i l i z e r t o prices r a i s e d f o r rice) is a measure o f t h i s i n t e r v e n t i o n . A p l a n n e r m i g h t a t t e m p t t o "compensatet1 f o r some t y p e s o f i n t e r v e n t i o n by s p e n d i n g more o r l e s s o n r e s e a r c h . The v a r i a b l e s , ECONAG, URBANPOP and V I O L D , a r e c r u d e p r o x i e s f o r p o l i t i c a l o r g a n i z a t i o n s a s well a s f o r i n t e r e s t g r o u p power. A p l a n n e r w i l l respond t o p r e s s u r e from i n t e r e s t groups, f o r e x a m p l e t o u r b a n pressure g r o u p s b y s h i f t i n g r e s o u r c e s f r o m r e s e a r c h t o c o m p e t i n g i n v e s t m e n t s even t h o u g h u r b a n c o n s u m e r s a r e t h e m a j o r b e n e f i c i a r i e s o f a g r i c u l t u r a l r e ~ e a r c h . ~High p r o p o r t i o n s of t h e l a b o r f o r c e i n a g r i c u l t u r e a r e u s u a l l y 18 a s s o c i a t e d w i t h weak p o l i t i c a l power o f r u r a l p e o p l e . t h i s c o u l d reduce s p e n d i n g on r e s e a r c h and e x t e n s i o n . If so, These p o l i t i c a l v a r i a b l e s , it s h o u l d be n o t e d , a r e p r o x i e s f o r many d i f f e r e n t c o m b i n a t i o n s o f i n t e r e s t s and t h e a b i l i t y t o t r a n s l a t e t h e s e i n t e r e s t s i n t o p o l i t i c a l action. I n t h e absence o f a p o l i t i c a l model l i t t l e i n t e r p r e t a t i o n c a n be g i v e n t o m e a s u r e d i m p a c t s . The j u s t i f i c a t i o n f o r t h e i n c l u s i o n of t h e s e v a r i a b l e s i n t h e model i s s i m p l y t h a t t h e y may c o n t r o l f o r some d i f f e r e n c e i n p o l i t i c a l c o n d i t i o n s and reduce b i a s i n t h e e s t i m a t e d p a r a m e t e r s t h a t can be g i v e n s t r o n g e r i n t e r p r e t a t i o n s . 19 3 Econometric Estimates: Investment Analysis T a b l e 8 l i s t s t h e v a r i a b l e s d i s c u s s e d above. The a c t u a l s p e c i f i c a t i o n requires a procedure f o r handling t h e p a r t i a l l y endogenous v a r i a b l e s , b a s i c a l l y t h e a i d v a r i a b l e s . In addition t h e f u n c t i o n a l f o r m h a s t o be s p e c i f i e d . The t w o - p e r i o d d a t a s e t ( s e t 1) d o e s n o t have s u f f i c i e n t observations t o e s t i m a t e i n v e s t m e n t r e l a t i o n s h i p s f o r each commodity. I t d o e s c o n t a i n a i d v a r i a b l e s and i s s u i t e d t o a general a n a l y s i s o f r e s e a r c h i n v e s t m e n t based on pooled commodity o b s e r v a t i o n s . The s e c o n d d a t a s e t f o r t h e 1962-82 p e r i o d d o e s c o n t a i n s u f f i c i e n t o b s e r v a t i o n s t o enable a n a n a l y s i s o f d e t e r m i n a n t s o f s p e n d i n g f o r each commodity and f o r e x t e n s i o n s p e n d i n g a s well. I t d o e s n o t c o n t a i n a i d v a r i a b l e s . 3.1 Aid Determinants - Two-Period D a t a The s p e c i f i c a t i o n f o r t h e t w o p e r i o d d a t a s e t a n d f o r t h e a i d a n a l y s i s is considered first. T h i s s p e c i f i c a t i o n requires t h a t n a t i o n a l r e s e a r c h s p e n d i n g and a i d be t r e a t e d a s s i m u l t a n e o u s l y d e t e r m i n e d . A Two-Stage L e a s t S q u a r e s p r o c e d u r e i s a p p r o p r i a t e . The e n d o g e n o u s v a r i a b l e s are: A I D , NDONORS, "STAFF, WBRES, WBEXT, I N T C R , CONGRU, B A S I C , EXTEXP a n d RESEXP. T h e l a t t e r t w o v a r i a b l e s a r e t h e most i m p o r t a n t from t h e p e r s p e c t i v e o f t h i s a n a l y s i s . The model t r e a t s e a c h o f t h e f i r s t e i g h t v a r i a b l e s as d e p e n d e n t on b o t h EXTEXP a n d RESEXP i n a d d i t i o n t o a number o f e x o g e n o u s v a r i a b l e s . EXTEXP a n d RESEXP a r e t r e a t e d a s d e p e n d e n t o n l y on a i d ( A I D o r WBRES a n d WBEXT) and a d i f f e r e n t s e t o f exogenous v a r i a b l e s . The e c o n o m e t r i c e s t i m a t e s b a s e d on t h i s model a r e r e p o r t e d i n T a b l e s 9 and 10. T a b l e 9 r e p o r t s t h e r e s u l t s of t h e a i d v a r i a b l e s and f o r c h a r a c t e r i s t i c s of n a t i o n a l s y s t e m s . T a b l e 10 s u m m a r i z e s t h e main r e s u l t s s h o w i n g d e t e r m i n a n t s o f i n v e s t m e n t i n 20 f i e l d c r o p r e s e a r c h ? l i v e s t o c k and h o r t i c u l t u r a l c r o p r e s e a r c h and i n e x t e n s i o n . The f u n c t i o n a l f o r m u s e d i s l i n e a r except t h a t s e v e r a l m u l t i p l i c a t i v e o r i n t e r a c t i o n v a r i a b l e s a r e u s e d . These a r e : PROD2 = PROD x PROD PRDDIVER = PROD x D I V E R PRDXPORT = PROD x EXPORTS PRDMPORT = PROD x IMPORTS INTSPLOC = I N T L O C x CINTSP A R E A C I N T = TOTALAREA x CINTSP A R E A D I V = TOTALAREA x D I V E R The BOO1 n o t a t i o n i d e n t i f i e s t h e e n d o g e n o u s v a r i a b l e s i n each e q u a t i o n . I n T a b l e 9? n a t i o n a l research s p e n d i n g ? RES a n d e x t e n s i o n s p e n d i n g EXTEXP a r e t h e e n d o g e n o u s v a r i a b l e s t r e a t e d i n d e t e r m i n i n g a i d f l o w s and c h a r a c t e r i s t i c s o f n a t i o n a l r e s e a r c h s y s t e m s ( t h e s e v a r i a b l e s a r e p r e d i c t e d i n T a b l e 10). A s t h e t a b l e s h o w s ? a i d a g e n c i e s do a p p e a r t o r e s p o n d t o n a t i o n a l investment i n extension but not t o investment i n research. Higher e x t e n s i o n spending a p p e a r s t o reduce b o t h t h e a i d level t o a g r i c u l t u r a l r e s e a r c h and t h e number o f d o n o r s p r o v i d i n g t h a t aid. A measure o f g e n e r a l a i d t o e x t e n s i o n is n o t a v a i l a b l e b u t t h e r e s u l t s d o show t h a t World Bank a i d t o e x t e n s i o n r e s p o n d s p o s i t i v e l y t o n a t i o n a l s p e n d i n g levels. ( O f c o u r s e r a s T a b l e 1 0 s h o w s ? n a t i o n a l s p e n d i n g r e s p o n d s p o s i t i v e l y t o World Bank s u p p o r t a s well. T h e t w o - s t a g e l e a s t s q u a r e s p r o c e d u r e i s designed t o i d e n t i f y t h e s e p a r a t e c a u s a l relationship.) Higher e x t e n s i o n s p e n d i n g a l s o a p p e a r s t o i n d u c e r e s e a r c h programs w i t h h i g h e r f r a c t i o n s o f non-commodity o r i e n t e d components.6 It a l s o i n d u c e s more I A R C a i d i n t h e f o r m o f n o n - h o s t s t a f f i n g . The p o s i t i v e TOTALAREA a n d n e g a t i v e A R E A D I V c o e f f i c i e n t s i n t h e A I D , N D O N O R S , W B R E S a n d W B E X T e q u a t i o n s show t h a t a i d 21 T a b l e 9 Estimated Coefficient and S t a t i s t i c s of Two-Stage L e a s t S q u a r e s Equations for D e t e r m i n a n t s of A i d * Dependent Variables 2xE: Intercept AID 21.541 (2.02) .830 (1.27) -.2% (5.49) .m3 (10.46) -.010 (9.65) -3.070 (4.88) -12.972 (1.881 .595 (4.50) .119 (1.12) 5Yt7.1 5.766 (1.40) -.m5 WBES BASIC 6.93 (4.49) .022 (23) 4.15 (2.55) 1.31 (1.24) -39.45 (1.46) .305 4.70 (2.36) 2.22 (1.76) -.010 ( . l 3 ) -.011 (1.71) . m 5 (1.49) 13.38 (3.38) .191 (. 78) .264 (4.17) .0009 BOOl.RES** B o O l . ~ * * (.18) 3 6 (2.29) .004 (.m) .O% (4.91) .112 (.24) -.OoOl (. 3 0 ) -.018 (2.30) -.063 (.71) .m3 (6.72) -.010 (6.18) 4.82 .087 (4.35) TOTLAREA AREADIV .oO02 (5.49) (5.53) -.014 (5.44) -.0003 (6.10) .001 (6.72) .115 -.097 (.08) -.ooo8 (6.84) .0025 (6.89) 2.48 (10.67) 10.35 (4.06) -.180 (3.66) -.016 ( .41) 22495 (7.38) -5.29 (3.47) .OW (2.44) I X l ~ (3) 1j0* (24) .008 -,0008 (5.63) -.328 (3.61) 5.83 (5.86) . o O 0 2 (1.43) .057 (.76) ,618 (.76) . 0 2 9 (1.83) UREARICE ARABLE ECaw 1.% (4.73) 5.94 (.53) .% (1.23) 46.52 (2.66) . 0 9 9 (.028 (2.26) .035 (.87) .005 -.M . a 4 (2.49) -.131 (8.49) 2637.9 (2.22) .510 (-86) .m15 (23) (4.41 ) .423 (2.45) 24723 (1.85) -2.94 (.44) (.%I -.047 (2.39) 5399.7 (3.51) 1.3 (6.88) .007 URBANPOP -.1% 68422 (.7a -.019 (1.55) -1200.7 (1.23) 3.09 (6.35) .003 (.51) ld04 (5.49) -.031 (1.71) (11.40) 90.88 (1.86) V I m (3.27) 15.24 (1.46) .066 INTLOC -.m (1.98) . m 5 (2.01) CINLSP ARFxmr -.035 (.46) +.IO-7 (24) -.563 -.m5 (.62) -1x10-7 (.33) .m3 (.lo) (.I11 4x10'7 (23) -.675 (4.35) (.%I 8JClO4 (1.48) 4XlO-9 4x104 (.I31 -MO4 (1.55) -.322 (.a) (.32) EXPRAT -.010 (. 4 8 ) (2.24) RESNSR 23.55 .384 24.03 . 3 8 8 (.a) - .151 (2.62) -.116 (3.16) -.o008 -A01 (1.89) 22.24 . 3 8 8 F 29.53 -438 37.60 .4989 10.42 .216 9.33 .198 15.64 P *%he .m *Absoiolute values of asympodct-ratios in parentiesea Bool notathitldicates that these variables atre treated rn d o g e m u s variebles (See Table 10) Table 10 Estimated Determinants of Two Major Groups of Research and Extension Spending* D e t Var b b le Independent Variables Intercept F i e l d Cro Research S (1) 2.69 (2.48) .001 (2.98) -1 2x1 0-7 (3.98) ., . , , 8 , , (2) 2.36 (2.27) .001 (3.91 -1. 2x1 0-7 (4.16) Crdp and Livestqck Research (3) 3.08 (1.94) .005 (5.92) -1x10-6 (5.58) (4) 3.37 (2.16) .005 (5.65) -1x10-6 (5.58) (5) 43 . O l (1.56) Horticultural National E x t m i o n SDendine PROD PROD2 TOTLAREA DIVER - - - - - (6) 75.72 (3.18) - PRDIVER AREADIV 1.09 (1.54) .001 (1.17) - - .055 (.14) .0005 (.63) .287 (.27) (3.03) -.005 1.17 (2.08) .005 (4.79) 9.15 (.28) -.014 (3.88) -5.82 (2.16) -2.51 (J7) .223 (-23) -.113 ( .24) -1 -87 (7.31) .003 (4.21) 8.89 (1.11) 007 (2.93) -5.16 (5.51 1 -19.88 (1.57) -.297 (1.09) -.309 (1.45) -1.67 (7.85) - - (;:E! (i:E? -1.11 (1.38) -.034 (1.91) 022 (1.50) .053 (4.83) .975 (.79) .342 (.63) -. - UREARICE ARABLE ECONAG URBANPOP EXPRAT INTLOC -. INTSPLOC .044 (.81) .574 (1.03) -.060 (3.35) -.035 (2.91) -.008 (1.05) 285 (.57) .211 (1.12) (.06) .033 .493 (.91) -.039 (3.27) -.023 (2.40) -.011 (1.45) -.095 (.19> .185 ( 1 .oo) -.125 (1.62) -1.20 (1.48) -.015 (.58) -.013 (.75) .054 (5.17) 1.27 (.99> .378 ( .70) -. - - - PRDXPORT PRDMPORT RESNSR T1 Rl R2 CINTSP B 001 A I D . 2x104 (5.71) 1.7~10'~ (9.43) .031 (3.35) .126 (1.03) -.451 (1.59) .409 (1.26) -.002 \( -42 .027 (2.04) 2x104 (5.50) 1 . 6 ~ 0' 1 6 (9.53) .024 (2.95) .048 (.42) -.156 (.55) .204 (.70) 2x10-5 (.OO) BOO1 .WBRES BOO1 .WBEXT - - - iXi 0-5 (10.85) 7x10-5 (5.01) .019 (2.38) .239 (1.29) -.786 (1.88) -.111 ( .24) .026 (3.00) -.020 (1.02) iX10-5 (10.86 7x10-5 (5.04) .023 (3.17) .283 (1.57) 951 (2.32) .123 (.29) .025 (2.90) -. - .006 (1.38) 1x10'6 (4.07) 45.03 .65 - 3x10'5 (3.59) -3x1 0'6 (.go) -.179 (.58) -9.19 (2.75) -3.42 (.38) 25.02 (2.05) .018 (.14) .012 .01 2 5x10'5 (3.35) - 3 ~ 0e6 1 ( 1 .oo> -.277 (1.66) 2.87 (.66) -4.23 (.76) 34.59 (5.65) .086 (.93) -.001 (.20) AFSAC INT R*F 1x10'6 (4.29) 43.17 .64 1.6~10'~ (6.15) 32.16 .59 ~ ,367 (3.30) 1 6 ~ 1 0 ' ~ 3 7 ~ 1 0 ' ~ 2.5~10'7 (.08) (6.05) (1.04) 47.25 32.36 35.31 .60 ~~ - - R) w R2 .55 ~~ .62 *Absolute values of asymptotic t - r a t i o s i n parentheses. 24 a g e n c i e s r e s p o n d n e g a t i v e l y t o d i v e r s i t y . They p r o v i d e more a i d t o l a r g e c o u n t r i e s w i t h l i t t l e diversity. Countries w i t h small a r e a s and h i g h l e v e l s of d i v e r s i t y a r e i n some sense d i s c r i m i n a t e d a g a i n s t by donors. T h i s i s i n c o n t r a s t t o a r e s u l t i n T a b l e 10 s h o w i n g t h a t n a t i o n a l g o v e r n m e n t s d o n o t r e s p o n d n e g a t i v e l y t o d i v e r s i t y i n t h e i r own f u n d i n g d e c i s i o n s . I n t e r e s t i n g l y t h e I A R C s do r e s p o n d p o s i t i v e l y t o d i v e r s i t y i n t h e i r non-host s t a f f i n g decisions. I t a p p e a r s t h a t when g o v e r n m e n t s p u r s u e h i g h f e r t i l i z e r / r i c e p r i c e p o l i c i e s ( i n t e r p r e t e d here as g e n e r a l p o l i c i e s d i s c r i m i n a t i n g a g a i n s t farmers and i n f a v o r of c o n s u m e r s ) a i d a g e n c i e s r e s p o n d by o f f e r i n g l e s s a i d t o r e s e a r c h ( a n d p o s s i b l y more t o e x t e n s i o n ) . They d o n o t c o m p e n s a t e f o r a n t i - s u p p l y p o l i c i e s by i n v e s t i n g more i n research. T h e i r r e s e a r c h p r o g r a m s a r e a l s o more b a s i c a n d m o r e c o n g r u e n t . T h a t i s t h e y a r e l e s s c o m m o d i t y o r i e n t e d a n d b e t t e r matched t o t h e i r c o m m o d i t y production patterns. t o respond t o l a n d exhaustion (i.e., low l e v e l s o f t h e ARABLE v a r i a b l e s ) by o f f e r i n g more a i d t o research. The World Bank does n o t . A i d d o n o r s i n c l u d i n g t h e World Bank d o a p p e a r t o r e s p o n d p o s i t i v e l y t o t h e i m p o r t a n c e o f t h e a g r i c u l t u r a l work f o r c e i n t h e g e n e r a l l a b o r force. T h i s is i n c o n t r a s t t o t h e t e n d e n c y o f n a t i o n a l programs t o s p e n d l e s s when t h e p r o p o r t i o n of w o r k e r s i n a g r i c u l t u r e is h i g h . T h i s i s p e r h a p s t h e o n e d i m e n s i o n where a i d d o n o r s a p p e a r t o be i n d u c i n g more " q u a l i t a t i v e l y o p t i m a l " programs. Aid donors g e n e r a l l y t e n d Aid d o n o r s do n o t appear t o respond t o I A R C l o c a t i o n s i n t h e i r programming. The I A R C s , h o w e v e r , d o f a v o r I A R C h o s t c o u n t r i e s i n t h e i r placement o f n o n - h o s t s t a f f a n d r e s e a r c h c o n t r a c t s and c o l l a b o r a t i v e a g r e e m e n t s t h a t is, c e n t e r s t e n d t o o u t p o s t s t a f f and c o n c l u d e a g r e e m e n t s i n c o u n t r i e s where o t h e r c e n t e r s are located. -- 25 The q u a l i t a t i v e d i m e n s i o n s o f n a t i o n a l p r o g r a m s a p p e a r t o r e s p o n d t o p o l i t i c a l f a c t o r s t o some extent. A h i g h e r p r o p o r t i o n of t h e l a b o r f o r c e i n a g r i c u l t u r e a p p e a r s t o i n d u c e more commodity o r i e n t e d a n d more c o n g r u e n t research p r o g r a m s . National programs a l s o appear t o respond t o s t r o n g r e s e a r c h p r o g r a m s by g e o - c l i m a t e n e i g h b o r s by u n d e r t a k i n g a l o w e r p r o p o r t i o n o f non-commodity r e s e a r c h . 3.2 R e s e a r c h and E x t e n s i o n Determinants -- Two-Period Data T a b l e 10 r e p o r t s t h e m o s t i m p o r t a n t r e s u l t s o f t h i s a n a l y s i s . I t shows t h e determinants of n a t i o n a l research s p e n d i n g on f i e l d c r o p s r e s e a r c h , on l i v e s t o c k and h o r t i c u l t u r a l c r o p s r e s e a r c h and on e x t e n s i o n s p e n d i n g . Two v e r s i o n s o f each e q u a t i o n a r e r e p o r t e d . I n t h e f i r s t (e.g., 1 , 3 a n d 5 ) g e n e r a l a i d i s t r e a t e d a s a d e t e r m i n a n t o f spending. I n t h e second (e.g., 2 # 4 a n d 6) W o r l d B a n k a i d t o r e s e a r c h ( o r e x t e n s i o n ) i s t r e a t e d a s t h e d e t e r m i n i n g v a r i a b l e . Cumulated I A R C s p e n d i n g (CINTSP) on t h e c o m m o d i t y i s t r e a t e d a s a n e x o g e n o u s v a r i a b l e 7 and tests w h e t h e r I A R C p r o g r a m s h a v e s t i m u l a t e d o r r e t a r d e d n a t i o n a l s p e n d i n g . T h i s v a r i a b l e is a l s o i n t e r a c t e d w i t h a variable measuringthe size o f t h e crop area i n thecountry ( A R E A C I N T = TOTALAREA x CINTSP). T h i s i s d e s i g n e d t o m e a s u r e whether t h e I A R C impact is related t o t h e s i z e o f t h e country. 8 T a b l e 10 s h o w s t h a t I A R C s p e n d i n g d i d n o t a f f e c t e x t e n s i o n s p e n d i n g , b u t t h a t it c l e a r l y d i d have a p o s i t i v e i m p a c t o n b o t h f i e l d c r o p r e s e a r c h s p e n d i n g and on l i v e s t o c k a n d h o r t i c u l t u r a l c r o p research s p e n d i n g . F u r t h e r , t h e i m p a c t i s p o s i t i v e l y related t o t h e s i z e of t h e c o u n t r y being a f f e c t e d . For f i e l d c r o p r e s e a r c h t h e a p p r o x i m a t e l y z e r o c o e f f i c i e n t on CINTSP s h o w s t h a t f o r s m a l l c o u n t r i e s there is l i t t l e o r no I A R C impact. For small c o u n t r i e s t h e AREACINT v a r i a b l e s h a s a low value. For large countries t h e p o s i t i v e impact is substantial. For l i v e s t o c k and h o r t i c u l t u r a l c r o p s i t a p p e a r s t h a t a p o s i t i v e 26 impact h o l d s even f o r small c o u n t r i e s . These r e s u l t s are n o t a f f e c t e d by t h e c h o i c e of a i d v a r i a b l e s . The r e s p o n s e of n a t i o n a l r e s e a r c h s y s t e m s p e n d i n g t o I A R C spending is c o n s i s t e n t w i t h t h e estimated p o s i t i v e response t o research u n d e r t a k e n by g e o - c l i m a t e n e i g h b o r s . T h e R E S N S R v a r i a b l e m e a s u r e s t h e s c i e n t i s t y e a r s d e v o t e d t o t h e c o m m o d i t y by o t h e r c o u n t r i e s i n t h e same broad geo-climate zone. T h e p o s i t i v e r e s p o n s e t o t h i s research a n d t o I A R C r e s e a r c h shows t h a t n a t i o n a l s y s t e m s see t h i s research a s o p e n i n g u p a d a p t i v e o p p o r t u n i t i e s f o r t h e i r own r e s e a r c h i n v e s t m e n t . The f a c t t h a t c o u n t r i e s d o n o t r e s p o n d t o t h i s r e s e a r c h s p e n d i n g by s p e n d i n g more o n e x t e n s i o n i s a l s o c o n s i s t e n t w i t h a p e r c e p t i o n t h a t t h e low t e c h n o l o g y b e i n g p r o d u c e d i n t h e s e s y s t e m s i s n o t so w e l l matched t o t h e i r own p r o d u c t i o n e n v i r o n m e n t s t h a t t h e y c a n s i m p l y f a c i l i t a t e i t s " s p i l l - i n t t a n d a d o p t i o n by i n v e s t i n g i n e x t e n s i o n . T h u s t h e p a t t e r n of r e s p o n s e i n b o t h research a n d e x t e n s i o n s p e n d i n g t o b o t h t h e I A R C research a n d t h e r e s e a r c h of geoclimate neighbors is c o n s i s t e n t with t h e f a c t t h a t a g r i c u l t u r a l t e c h n o l o g y h a s a h i g h degree of l o c a t i o n s p e c i f i c i t y . The t y p i c a l d e v e l o p i n g c o u n t r y a p p e a r s t o h a v e r e c o g n i z e d t h a t new t e c h n o l o g y d o e s n o t e a s i l y s p i l l - i n from a b r o a d a n d t h a t low c o s t extension investment is not s u f f i c i e n t t o facilitate its t r a n s f e r . On t h e w h o l e , t e c h n o l o g y p r o d u c e d a b r o a d i s mismatched t o c o n d i t i o n s a t home. T h e d e g r e e o f t h e m i s m a t c h i s n o t s o g r e a t , h o w e v e r , t h a t i t d o e s n o t p r e v e n t new o p p o r t u n i t i e s f o r a d a p t i v e r e s e a r c h a t home. I n a d d i t i o n t o m i s m a t c h e d t e c h n o l o g y , research i n s t i t u t i o n s a b r o a d a r e a l s o p r o d u c i n g p r e - t e c h n o l o g y s c i e n c e of r e l e v a n c e . I t t o o i s o f v a l u e a t home o n l y when a s t r o n g r e s e a r c h c a p a c i t y h a s been b u i l t . T h i s i n t e r p r e t a t i o n of t h e I A R C i m p a c t h a s i m p o r t a n t p o l i c y i m p l i c a t i o n s ( a s d e s c r i b e d below). The s t a t i s t i c a l m e a s u r e s r e p o r t e d i n T a b l e 10 s u p p o r t t h i s i n t e r p r e t a t i o n . However, i t i s a l s o i m p o r t a n t t h a t t h e more g e n e r a l i n v e s t m e n t e s t i m a t e s b e 27 judged a g a i n s t a u i o r h l o g i c o r e x p e c t a t i o n s t o determine whether t h e s p e c i f i c I A R C i m p a c t s a r e p a r t o f a g e n e r a l l y consistent investment relationship. To t h i s e n d , c o n s i d e r t h e i m p a c t s o f t h e e c o n o m i c v a r i a b l e s on i n v e s t m e n t . F o r a l l r e s e a r c h a c t i v i t i e s , t h e PROD and PROD2 i m p a c t s a r e s i g n i f i c a n t and a s expected. H o l d i n g g e o - c l i m a t e d i v e r s i t y c o n s t a n t , an i n c r e a s e i n t h e u n i t s produced o f a commodity o f f e r s a t y p e o f s c a l e economy t o a r e s e a r c h system. Thus s p e n d i n g p e r u n i t o f p r o d u c t i o n w i l l d e c l i n e a s shown by t h e n e g a t i v e p r o d u c t i o n s q u a r e d term. An i n c r e a s e i n d i v e r s i t y i t s e l f d o e s n o t h a v e a s t r o n g i m p a c t on f i e l d c r o p s r e s e a r c h , ( a l t h o u g h i t i s p o s i t i v e ) , b u t d o e s a p p e a r t o s t i m u l a t e more s p e n d i n g on l i v e s t o c k a n a h o r t i c u l t u r a l r e s e a r c h when p r o d u c t i o n i s low. High l e v e l s o f d i v e r s i t y r e d u c e t h e p r o d u c t i o n i n p u t s on t h i s r e s e a r c h s p e n d i n g . T h e same s i t u a t i o n h o l d s f o r e x t e n s i o n s p e n d i n g . Higher levels of d i v e r s i t y l o w e r t h e i m p a c t o f t o t a l a r e a on e x t e n s i o n spending. T h i s a p p e a r s t o be a k i n d o f d i s e c o n o m y o r discouragement effect. The expected n e g a t i v e s i g n on t h e ARABLE v a r i a b l e i s b o r n e o u t o n l y f o r t h e l i v e s t o c k and h o r t i c u l t u r a l c r o p s r e s e a r c h ( a n d p o s s i b l y f o r e x t e n s i o n ) . When t h e r a t i o o f a r a b l e l a n d c u r r e n t l y t o a r a b l e l a n d 6 y e a r s p r e v i o u s l y i s low i t i s i n d i c a t i n g a n exhaustion of a r a b l e land. The EXPRAT v a r i a b l e m e a s u r e s t h e r a t i o o f a "price" o f r e s e a r c h s e r v i c e s t o a p r i c e o f e x t e n s i o n services. S i n c e t h e d e p e n d e n t v a r i a b l e i s expressed i n e x p e n d i t u r e terms i f t h i s v a r i a b l e has a zero c o e f f i c i e n t , t h e a c t u a l price e l a s t i c i t y is -1 S i n c e t h i s r a t i o i s probably measured w i t h e r r o r i t s c o e f f i c i e n t w i l l be b i a s e d toward zero. I t is i m p o r t a n t , t h e r e f o r e , t h a t t h e s t a n d a r d e r r o r be c o n s i d e r e d i n i n t e r p r e t i n g t h i s variable. To f a c i l i t a t e t h i s a r a n g e o f p r i c e e l a s t i c i t i e s 0 28 (*I s t a n d a r d d e v i a t i o n ) i s r e p o r t e d i n t h e f o l l o w i n g s e c t i o n . T h i s range s h o w s t h a t p r i c e s do m a t t e r . Those c o u n t r i e s t h a t h a v e l o w e r e d t h i s r a t i o by d e v e l o p i n g a c a p a c i t y f o r t r a i n i n g s c i e n t i s t s a t home and a r e d u c e d d e p e n d e n c y on c o s t l y e x p a t r i a t e s c i e n t i s t s h a v e r e s p o n d e d b y b u y i n g m o r e u n i t s o f r e s e a r c h and by s p e n d i n g more on r e s e a r c h . i The v a r i a b l e s m e a s u r i n g p o l i t i c a l f a c t o r s a r e i m p o r t a n t . They show v e r y s t r o n g i n t e r n a t i o n a l t r a d e e f f e c t s . If a c o m m o d i t y i s e x p o r t e d more r e s e a r c h p e r d o l l a r o f p r o d u c t i s expended f o r a l l commodities. Export o r i e n t a t i o n a l s o s t i m u l a t e s e x t e n s i o n s p e n d i n g . T h i s i m p a c t is h i g h e r f o r t h e h o r t i c u l t u r a l c r o p s and l i v e s t o c k , p e r h a p s r e f l e c t i n g p o s t - c o l o n i a l e f f e c t s i n w h i c h r e s e a r c h or e x p o r t c o m m o d i t i e s t r a d i t i o n a l l y had s t r o n g "mother country" s u p p o r t . I t is i n t e r e s t i n g , however, t h a t t h e impact of imports of t h e commodities has a s t i m u l u s effect of r o u g h l y t h e s a m e m a g n i t u d e i n f i e l d c r o p s and o f l a r g e r m a g n i t u d e f o r t h e l i v e s t o c k and h o r t i c u l t u r a l crops. I m p o r t s do n o t a f f e c t extension spending. T h i s e x t r a a t t e n t i o n t o t r a d e d commodities h a s several r a t i o n a l explanations. Most d e v e l o p i n g c o u n t r i e s h a v e p u r s u e d general economic p o l i c i e s t h a t place a h i g h v a l u e on f o r e i g n e x c h a n g e . Demand e l a s t i c i t i e s for t r a d e d c r o p s a r e h i g h s o s u p p l y c a n be i n c r e a s e d w i t h o u t s i g n i f i c a n t r e d u c t i o n i n m a r k e t p r i c e s . I n c r e a s e d i m p o r t s o f c o m m o d i t i e s may a l s o p r o v i d e p o l i t i c a l s i g n a l s t h a t s o m e t h i n g s h o u l d be done a b o u t d o m e s t i c supply. O f c o u r s e , t h e r e s t i l l may b e a c o l o n i a l l e g a c y reflected i n t h e d a t a b u t t h e i m p o r t e f f e c t s s u g g e s t t h a t a more general set of f a c t o r s a r e operating t o favor traded over nontraded commodities. The v a r i a b l e p r o x y f o r a g r i c u l t u r a l p r i c e p o l i c i e s , U R E A R I C E , d o e s n o t have s i g n i f i c a n t e f f e c t s on r e s e a r c h a l t h o u g h c o u n t r i e s pursuing price p o l i c i e s t h a t d i s c r i m i n a t e a g a i n s t farmers ( a s m e a s u r e d by a high u r e a - r i c e p r i c e r a t i o ) t e n d t o 29 s p e n d l e s s on l i v e s t o c k a n d h o r t i c u l t u r a l c r o p r e s e a r c h . They a l s o s p e n d l e s s on e x t e n s i o n t h u s t h e y d o n o t a t t e m p t t o c o m p e n s a t e f o r n e g a t i v e p r i c e e f f e c t s o n s u p p l y by s p e n d i n g more on research and e x t e n s i o n . The v a r i a b l e s m e a s u r i n g t h e c h a r a c t e r i s t i c s o f t h e a g r i c u l t u r a l l a b o r f o r c e and t h e u r b a n i z a t i o n o f t h e p o p u l a t i o n r e f l e c t v e r y good p o l i t i c a l p r o c e s s e s and c a n n o t be g i v e n v e r y clear interpretations. An i n c r e a s e i n t h e percent o f t h e p o p u l a t i o n l i v i n g i n u r b a n c e n t e r s o f 100,000 p o p u l a t i o n a n d m o r e t e n d s t o r e d u c e s p e n d i n g o n r e s e a r c h and e x t e n s i o n , p a r t i c u l a r l y on f i e l d c r o p s r e s e a r c h . T h i s p r e s u m a b l y i s m e a s u r i n g p o l i t i c a l power w i t h an i n t e r e s t i n d i r e c t i n g g o v e r n m e n t s p e n d i n g t o n o n a g r i c u l t u r a l interests. Countries w i t h high p r o p o r t i o n s o f t h e i r l a b o r f o r c e i n a g r i c u l t u r e a l s o s p e n d l e s s on research and extension, p a r t i c u l a r l y f i e l d crop research. T h i s v a r i a b l e is n o t m e a s u r i n g t h e s a m e phenomena a s t h e u r b a n i z a t i o n v a r i a b l e , b u t it is n o t i n c o n s i s t e n t t o s u g g e s t t h a t f a r m e r p o l i t i c a l power i s a c t u a l l y weakest i n t h e p o o r e s t e c o n o m i e s w i t h h i g h p r o p o r t i o n O f workers i n agriculture. Since t h i s v a r i a b l e i s a l s o a proxy f o r t h e g e n e r a l w e a l t h o f a s o c i e t y i t may b e m e a s u r i n g a k i n d o f w e a l t h e f f e c t . If s o i t s h o u l d b e n o t e d t h a t t h e r e i s a c e r t a i n i r r a t i o n a l i t y b e h i n d i t s i n c e i n v e s t m e n t i n r e s e a r c h and e x t e n s i o n i s a p r o d u c t i o n i n v e s t m e n t , n o t a form o f p u b l i c consumption. T h e r e s u l t s r e p o r t e d i n T a b l e s 9 a n d 1 0 a r e b a s e d o n t h e twop e r i o d d a t a s e t f o r which a i d v a r i a b l e s a r e a v a i l a b l e . The r e s u l t s w i t h r e s p e c t t o t h e a i d v a r i a b l e s show t h a t g e n e r a l a i d f o r r e s e a r c h ( a s m e a s u r e d by A I D ) d o e s i n c r e a s e r e s e a r c h s p e n d i n g f o r f i e l d c r o p s r e s e a r c h b u t n o t f o r l i v e s t o c k and h o r t i c u l t u r a l crop research o r f o r e x t e n s i o n . The c o e f f i c i e n t s show d i s p l a c e m e n t o f a i d e f f e c t s on r e s e a r c h s p e n d i n g o f t w o s o r t s . F i r s t , r e s e a r c h s p e n d i n g on f i e l d c r o p s d o e s n o t i n c r e a s e by t h e f u l l amount o f t h e a i d . Second some r e d u c t i o n i n l i v e s t o c k and h o r t i c u l t u r a l c r o p r e s e a r c h i s induced by a i d . 30 The r e s u l t s when World Bank a i d i s p r o v i d e d a r e s i m i l a r f o r a i d t o r e s e a r c h a l t h o u g h t h e a p p a r e n t d i s p l a c e m e n t i s more severe. World Bank a i d t o e x t e n s i o n , on t h e o t h e r h a n d , p r o v i d e s a s t r o n g s t i m u l u s t o n a t i o n a l extension investment.'O The m a g n i t u d e o f t h e a i d and o t h e r i m p a c t s on s p e n d i n g w i l l be d i s c u s s e d f u r t h e r i n t h e concluding p o l i c y s e c t i o n o f t h e p a p e r . B e f o r e t u r n i n g t o t h a t d i s c u s s i o n , r e s u l t s from t h e second d a t a s e t are r e p o r t e d . 3.3 Annual D a t a A n a l y s i s The a n n u a l d a t a s e t , a s n o t e d e a r l i e r , d o e s n o t h a v e d a t a on a i d v a r i a b l e s . I t i s , h o w e v e r , c o n s i d e r a b l y r i c h e r i n terms o f o b s e r v a t i o n s by commodity. A c c o r d i n g l y t h e r e s u l t s r e p o r t e d i n T a b l e 1 1 a r e by c o m m o d i t y a n d f o r p o o l e d c o m m o d i t y g r o u p s : c e r e a l s ( m a i z e , sorghum, millet, rice, wheat), s t a p l e s ( b e a n s , c a s s a v a , g r o u n d n u t s , p o t a t o e s , s w e e t p o t a t o e s ) and commercial c r o p s ( s o y b e a n s a n d s u g a r ) . (Dummy v a r i a b l e s f o r c o m m o d i t i e s a r e included i n a l l pooled regressions.) The s p e c i f i c a t i o n d i f f e r s f r o m t h a t i n T a b l e 10 i n t h r e e ways. F i r s t , s i n c e a i d v a r i a b l e s a r e n o t a v a i l a b l e , t h e v a r i a b l e V I O L D ( a p o l i t i c a l unrest v a r i a b l e i n t h e e a r l i e r analysis) is i n c l u d e d i n these r e g r e s s i o n s . S e c o n d , a n e f f o r t i s made t o e s t i m a t e b o t h a n a r e a a n d p r o d u c t i o n and hence y i e l d i m p a c t on r e s e a r c h s p e n d i n g . T h i r d , i n t e r n a t i o n a l t r a d e v a r i a b l e s were n o t i n c l u d e d i n t h e s e regressions. These results are g e n e r a l l y c o n s i s t e n t w i t h t h o s e r e p o r t e d i n T a b l e 10 a n d s h o w a h i g h d e g r e e o f c o n s i s t e n c y a c r o s s c o m m o d i t i e s . The I A R C s p e n d i n g i m p a c t w h i c h i s o f c e n t r a l concern t o t h i s study has a s t a t i s t i c a l l y significant c o e f f i c i e n t i n r e g r e s s i o n s f o r m a i z e , s o r g h u m , r i c e , w h e a t , p o t a t o e s and sweet p o t a t o e s and i n t h e p o o l e d c e r e a l s and s t a p l e s r e g r e s s i o n . O t h e r s t u d i e s h a v e shown t h a t t h e I A R C c o n t r i b u t i o n s i n terms o f t e c h n o l o g y development and r e s e a r c h c o n t r i b u t i o n s have been 31 Table 11 E s t i m a t e d D e t e r m i n a n t s of C o m m o d i t y - S p e c i f i c N a t i o n a l A g r i c u l t u r a l Research a n d E x t e n s i o n S p e n d i n g , Annual D a t a 1963-1980, 25 C o u n t r i e s D.pcnd*ne Variable: Independent Variable. PRODUCTION AREA Spendinn in 1980 Dollars % 0.000024* 0.000045* 0.000009** Sornhum RiC. Cereals B s . n s c _ cassava IARCSPEND INC UREARICEPRICE RESNEIGHBORS PRDPAGRUK~ URBANIZATION RESEXTPRICE LAM) EXHAUSTION DIVERSITY PROD X DIVERSITY POLVIOLENCE RZ P -0.0302 0.0217** -0.0132** -0.0049 0.00 76* -0.3481 0.6024** 0.000015** -696.59** 0.5554 48.94 Indrpandent Variables PBOWCTIOII N u Groundnuts 0.00014** Po taco.. -0.00007** Sweet Potatoes SC.PlU -0.000028** 0.00023** Smbcans SUKat 0.000043** -0.0018** 0.8. Cownercial Croas -0.000014** 0.0016** IARCSPENDINC UREARICEPRICE RESNEICHBORS PROPACRWKRS URBANIZATION -0.000031 0.000026 -0.0144 0.0358** -0.0052** -0.0021 mS&XTPRICE LAM) 0.0052* O.OOOOO12 0.00011 O.0000042** O.OOOO19** 0.0238** -0.0426** -0.0069 -0.0637** -0.0122** -0.0030* -0.0054** -0.0052** -0.0060*4 0.0019 0.0033** 0.000082 0.0011** n.a. -0.0206 0.0218** -0.0107** 0.000006** -0.0240** 0.0399** -0.0048** -0.0015 -0.0066** -0.0386 0.0855 n.a. 0.0231* -0.0081* -0.0?79** 0.0556** 0.0118* -0.0250** -0.0047 0.0023 0.0182** -0.0185** -0.0060** -0.0088** EXXAUSiION DIVERSITY PROD X DIVERSITY POLVIOLENCE R2 I 0.0086 0.4257** 0.2074 -0.3061** -0.1212 0.0131 0.6474 0.4924** 0.0393 1.0267** 0.000023** 0.3016 0.7411** 0.000021** 0.0000057** -0.000004** 2.967E-07 -39.83 -181.44* 72.86 0.4169 0.6297 0.1432 28.00 66.61 6.55 O.ooo0059** 0.000021** -250.59** -1378.33** 0.3297 0 . aaa6 98.45 341.67 -547.79** 0.7037 -969.57** 0.8203 396.02 101.67 *T ratio b*cmeo 1.5 and 2.0 **T ratio 8rmat.r rhan 2 . 0 32 h i g h e r i n t h e s e c o m m o d i t i e s ( o t h e r t h a n sweet p o t a t o e s ) t h a n i n beans, c a s s a v a and groundnuts. These l a t t e r c o m m o d i t i e s a r e g e n e r a l l y regarded t o present l l d i f f i c u l t n c h a l l e n g e s t o researchers. To some extent t h i s i s d u e t o t h e f a c t t h a t t h e y h a v e r e c e i v e d r e s e a r c h a t t e n t i o n f o r a s h o r t e r p e r i o d o f time t h a n i s t h e c a s e f o r t h e c e r e a l g r a i n s , where c o n s i d e r a b l e r e s e a r c h i n d e v e l o p e d c o u n t r i e s h a s been u n d e r t a k e n o v e r many years . The r e s p o n s e o f n a t i o n a l e x p e n d i t u r e s t o t h e r e s e a r c h b y geo-climate n e i g h b o r s i s p o s i t i v e i n most commodities and i n t h e p o o l e d r e g r e s s i o n c o n f i r m i n g t h e r e s u l t s r e p o r t e d i n T a b l e 10. An i n c r e a s e i n p r o d u c t i o n h o l d i n g a r e a c o n s t a n t , i.e., a n i n c r e a s e i n y i e l d s , s t i m u l a t e s r e s e a r c h spending i n t h e cereal g r a i n s and c a s s a v a , b u t y i e l d i s n o t g e n e r a l l y h i g h l y c o r r e l a t e d w i t h research s p e n d i n g . An i n c r e a s e i n g e n e r a l d i v e r s i t y d o e s s t i m u l a t e more research s p e n d i n g i n a l m o s t a l l c o m m o d i t i e s a n d t h e p r o d u c t i o n i m p a c t on r e s e a r c h s p e n d i n g i s h i g h e r f o r a l l commodities, t h e higher t h e level o f d i v e r s i t y . These d a t a show r e l a t i v e l y weak l a n d e x h a u s t i o n e f f e c t s . The r e l a t i v e p r i c e of r e s e a r c h t o e x t e n s i o n s e r v i c e s i s a s i g n i f i c a n t d e t e r m i n a n t o f s p e n d i n g . I t s h o w s some b i a s i n t h a t a d e c l i n e i n t h e c o s t s o f d o i n g research seems t o s t i m u l a t e r e s e a r c h s p e n d i n g on w h e a t , r i c e and m a i z e m o s t . Land e x h a u s t i o n e f f e c t s a r e g e n e r a l l y n o t s i g n i f i c a n t . The p o l i t i c a l v a r i a b l e s ECONAG a n d U R B A N P O P show e f f e c t s s i m i l a r t o t h o s e r e p o r t e d f o r T a b l e 10. U r b a n i z a t i o n a p p e a r s t o b e b i a s e d t o w a r d s t i m u l a t i n g more w h e a t r e s e a r c h and l e s s r e s e a r c h on o t h e r commodities. When t h e p r i c e p o l i c i e s o f c o u n t r i e s d i s c r i m i n a t e a g a i n s t farmers, t h e y a l s o d i s c r i m i n a t e a g a i n s t r e s e a r c h s p e n d i n g except f o r wheat and p o t a t o e s . P o l i t i c a l violence is associated w i t h reduced spending f o r most t y p e s o f r e s e a r c h . 33 On t h e w h o l e , t h e r e s u l t s f o r s p e c i f i c f i e l d c r o p commodities reinforce t h e conclusions of t h e e a r l i e r analysis. T h e y show a h i g h l e v e l of c o n s i s t e n c y a c r o s s c o m m o d i t i e s . i 35 4 P o l i c y I m p l i c a t i o n s of I n v e s t m e n t A n a l y s i s \ The r e s u l t s o f t h e e c o n o m e t r i c e x e r c i s e r e p o r t e d i n T a b l e s 9, 10 and 11 have s u b s t a n t i a l p o l i c y r e l e v a n c e . W h i l e t h e y d o show a c o n s i d e r a b l e degree of c o n s i s t e n c y w i t h r a t i o n a l p l a n n i n g on t h e p a r t of n a t i o n a l g o v e r n m e n t s i t c a n n o t b e c o n c l u d e d t h a t there is l i t t l e reason f o r active p o l i c y i n t e r v e n t i o n s t o change n a t i o n a l g o v e r n m e n t i n v e s t m e n t s . I n d e e d a n o t h e r l a r g e b o d y of e v i d e n c e ( s e e Evenson, Waggoner a n d R u t t a n , 1981 a n d R u t t a n , 1984) shows t h a t r e s e a r c h i n v e s t m e n t s h a v e p r o d u c e d e x t r a o r d i n a r i l y h i g h r e t u r n s i n terms of t h e i n c r e a s e d a g r i c u l t u r a l o u t p u t a s s o c i a t e d w i t h r e s e a r c h programs. The i m p l i c a t i o n i s t h a t there is g e n e r a l underinvestment i n research. Comparisons by r e g i o n and by c o m m o d i t y show s u b s t a n t i a l v a r i a t i o n s i m p l y i n g u n d e r i n v e s t m e n t i n a t l e a s t some p r o g r a m s o f research. W i t h t h i s i n mind t h e n it i s u s e f u l t o c a l c u l a t e t h e m a r g i n a l i m p a c t s o f a l t e r n a t i v e p o l i c y - r e l a t e d a c t i v i t i e s on n a t i o n a l r e s e a r c h and e x t e n s i o n s p e n d i n g . T a b l e 1 2 r e p o r t s a number o f s u c h c a l c u l a t i o n s b a s e d on t h e r e g r e s s i o n e s t i m a t e s r e p o r t e d i n T a b l e s 10 a n d 11. The t a b l e s h o w s t h a t a s c o m m o d i t y p r o d u c t i o n i n c r e a s e s b o t h r e s e a r c h and e x t e n s i o n s p e n d i n g rises b u t a t a r a t e l e s s t h a n I ,/ L p r o p o r t i o n a l t o t h e p r o d u c t i o n i n c r e a s e s . T h e " e l a s t i c i t i e s " of s p e n d i n g w i t h r e s p e c t t o p r o d u c t i o n e v a l u a t e d a t t h e mean a r e i n t h e 0.55 t o 0.6 r a n g e . T h i s means t h a t a t t h e mean o f t h e s a m p l e a 10 p e r c e n t i n c r e a s e i n p r o d u c t i o n i n d u c e s a 5.5 t o 6 p e r c e n t i n c r e a s e i n spending. T h i s is probably due t o f i x e d c o s t s of u n d e r t a k i n g r e s e a r c h a n d e x t e n s i o n p r o g r a m s a n d I*realtt s c a l e economies t o s i z e . The i m p l i e d scale parameter i s e s s e n t i a l l y t h e i n v e r s e o f t h i s e 1 , a s t i c i t y ( i . e . , 1/.6 = 1 . 6 6 ) . However, i t may a l s o r e f l e c t a n o v e r e s t i m a t e of r e a l s c a l e e c o n o m i e s and a t e n d e n c y on t h e p a r t of g o v e r n m e n t s t o f e e l t h a t o n c e a s u b s t a n t i a l r e s e a r c h program i s i n p l a c e , i t n e e d n o t b e e x p a n d e d w i t h t h e i m p o r t a n c e o f t h e crop. I 1 T a b l e 12 C a l c u l a t e d I m p a c t s o n N a t i o n a l R e s e a r c h and E x t e n s i o n I n v e s t m e n t ( M i l l i o n s of 1980 D o l l a r s ) .- Annual Research Spending Million Dollars (from Table 10) Field Crops .551 Livestock and Horticulture Crops .584 .00396 .002277 .01253 .01901 Policy Variable 1 million $ added to (elasticity) Commodity production (dollars) Extension Spending .592 .00624 .00695 .00164 .000634 .000472 .0305 1 million ! $ added to commodity exports 1 million $ added to commodity imports 1 added SY by geo-climate neighbor Ten percent decline in research costs + std. deviation per SY on ten percent spending rice is extension costs EW -.000937 -.1792 -.0001 7 -1.051 -1.191 .00005 -.00064 -.00042 -.474 -.652 1.084 10.840 -.858 -.063 .00188 .00145 -1.456 -1.591 .lo5 1.050 + std. deviation quantity elasticity 1 million dollars added to IARC research stock a) first year b) after 10 years 1 million dollars general aid research World Bank aid (to research or extension) .229 2.290 1.194 .285 +. 047 1.468 Maize 1 added SY by geo-climate neighbor Ten percent decline in urea-rice price 1 million dollars added to IARC investment a ) first year b) after 10 years Research Spending by Commodity (from Table 11) Ground Sorghum Millets Rice Wheat Beans Cassava nuts .0307 .050 Sweet Potatoes Potatoes -.0069 -.0637 .043 .475 4.750 .0217 .030 .0355 .039 1.000 10.00 .0121 .026 .168 1.680 -.0506 -.259 1.725 17.250 .0434 .0672 .019 .045 .0358 .015 .650 6.500 -.024 1.050 10.500 .225 .550 2.250 5.500 .162 -.OOO 1.620 -.OOO .cP 37 The t a b l e a l s o s h o w s t h a t when t h e c o m m o d i t y b e i n g p r o d u c e d i s e x p o r t e d r e s e a r c h s p e n d i n g p e r u n i t o f p r o d u c t i s 1.39 t i m e s a s h i g h f o r f i e l d c r o p s and 1.54 times a s h i g h a s f o r l i v e s t o c k and h o r t i c u l t u r a l c r o p s a s i t i s f o r n o n - t r a d e d c o m m o d i t i e s . (The number f o r an i n c r e a s e i n t r a d e d commodity p r o d u c t i o n i s t h e sum o f t h e commodity p r o d u c t i o n n u m b e r s and t h e t r a d e d commodity l i n e s . ) When t h e commodity i s i m p o r t e d , s p e n d i n g p e r u n i t o f p r o d u c t i s 1.29 times a s h i g h f o r f i e l d c r o p s and o v e r 4 times a s h i g h f o r l i v e s t o c k and h o r t i c u l t u r a l c r o p s (where i m p o r t s are g e n e r a l l y very low). C o u n t r i e s a r e a p p a r e n t l y p l a c i n g a h i g h premium on f o r e i g n e x c h a n g e . The p o s i t i v e r e s p o n s e by c o u n t r i e s t o a n added SY on t h e commodity by a g e o - c l i m a t e n e i g h b o r i s q u a n t i t a t i v e l y s i g n i f i c a n t i n f i e l d c r o p s and a p p e a r s t o b e b i a s e d t o w a r d a l l c e r e a l s e x c e p t w h e a t and toward b e a n s , c a s s a v a and g r o u n d n u t s . T h e i n d u c e d s p e n d i n g o f $30,000 i s l a r g e i n v i e w o f t h e f a c t t h a t t h e c o s t o f t h e a d d e d SY may b e o n l y a l i t t l e more t h a n t h a t . The c o m p u t a t i o n s f o r a 1 0 p e r c e n t d e c l i n e i n t h e r e s e a r c h c o s t s per SY h a s p o l i c y r e l e v a n c e . Many c o u n t r i e s h a v e o p t i o n s t o r e d u c e t h e s e c o s t s t h r o u g h i m p r o v e m e n t o f t h e i r own c a p a c i t y t o t r a i n s c i e n t i s t s and t h r o u g h b e t t e r i n c e n t i v e s t r u c t u r e s t o hold s c i e n t i s t s i n r e s e a r c h p o s i t i o n s , I n A f r i c a an expansion i n t h e i n d i g e n o u s s c i e n t i s t s component and a r e d u c t i o n i n a d m i n i s t r a t i v e c o s t s can e a s i l y allow a reduction i n c o s t s per scientist. A decline i n t h e r e s e a r c h c o s t by 10 percent w i l l r e s u l t i n a s l i g h t i n c r e a s e i n s p e n d i n g on research. T h i s means t h a t t h e i n c r e a s e i n q u a n t i t y o f SYs p u r c h a s e d w i l l r i s e b y a l i t t l e l e s s t h a n 10 p e r c e n t f o r f i e l d c r o p r e s e a r c h and by a p p r o x i m a t e l y 6 p e r c e n t f o r l i v e s t o c k and h o r t i c u l t u r a l c r o p r e s e a r c h . A 10 p e r c e n t d e c l i n e i n e x t e n s i o n c o s t s , on t h e o t h e r h a n d , w i l l i n c r e a s e t h e p u r c h a s e o f e x t e n s i o n w o r k e r s by 14.5 t o 15.9 percent and w i l l a l s o i n c r e a s e t o t a l spending. , The f i n a l c a l c u l a t i o n s r e g a r d i n g a i d and I A R C s p e n d i n g a r e of most i n t e r e s t . The form o f t h e model m e a s u r i n g I A R C i m p a c t s was t h a t t h e s t o c k (i.e., c u m u l a t e d e x p e n d i t u r e s i n 1980 d o l l a r s ) of IARC i n v e s t m e n t i m p a c t e d on t h e a n n u a l f l o w of n a t i o n a l research s p e n d i n g . Thus, a m i l l i o n d o l l a r i n c r e m e n t t o I A R C s p e n d i n g i n 1 9 7 8 w o u l d r a i s e t h e v a l u e o f t h e CINTSP v a r i a b l e i n 1978, 1979, e t c . I f t h i s I A R C s p e n d i n g was i n t h e f i e l d c r o p s it w o u l d s t i m u l a t e $229,000 a d d e d a n n u a l n a t i o n a l r e s e a r c h i n v e s t m e n t i n t h e f i r s t y e a r ( 1 9 7 8 ) . ( T h i s is c a l c u l a t e d a s t h e t o t a l of t h e s p e n d i n g i m p a c t s i n t h e 2 4 c o u n t r i e s i n t h e sample. P r e s u m a b l y t h e scope o f i n f l u e n c e i s w i d e r t h a n f o r t h e s e 2 4 c o u n t r i e s , s o t h i s i s a n u n d e r e s t i m a t e o f t h e e f f e c t . ) By 1988, a t o t a l of $2,290,000 a d d e d a n n u a l n a t i o n a l research i n v e s t m e n t would h a v e b e e n s t i m u l a t e d by t h e 1 m i l l i o n d o l l a r e x p e n d i t u r e i n 1978. W i t h t h e d a t a a t hand i t is n o t r e a l l y p o s s i b l e t o estimate t h e d e t e r i o r a t i o n o f t h i s effect. It is c o n s e r v a t i v e t o s u p p o s e t h a t i t w i l l l a s t o n l y 10 y e a r s ( a b o u t t h e a v e r a g e t i m e period for IARC investment i n t h e d a t a s e t ) . The r e s u l t s f o r i n d i v i d u a l f i e l d crops (based on Table 11 a n d t h e a n n u a l d a t a ) a l s o show i n v e s t m e n t i m p a c t s t h a t a r e g e n e r a l l y l a r g e . Only c a s s a v a s h o w s n o i m p a c t . I A R C i n v e s t m e n t s o f 1 m i l l i o n d o l l a r s i n p o t a t o e s , sweet p o t a t o e s , w h e a t , s o r g h u m and m i l l e t s a p p e a r t o s t i m u l a t e an added m i l l i o n d o l l a r s i n n a t i o n a l s p e n d i n g w i t h i n 1 o r 2 y e a r s . Even f o r m a i z e a n d r i c e t h e added n a t i o n a l investment is s i g n i f i c a n t . T h i s may b e compared w i t h t h e e s t i m a t e s f o r d i r e c t a i d . T h e y show t h a t 1 m i l l i o n d o l l a r s i n g e n e r a l a i d i n c r e a s e s f i e l d c r o p r e s e a r c h b y more t h a n 1 m i l l i o n d o l l a r s b u t a t t h e c o s t o f r e d u c i n g s p e n d i n g on l i v e s t o c k a n d f i e l d c r o p r e s e a r c h . Thus t a k i n g t h i s d i s p l a c e m e n t i n t o a c c o u n t , o n l y $336,000 n e t i n c r e m e n t a l research spending t a k e s p l a c e f o r t h e 1 m i l l i o n d o l l a r a i d g r a n t o r l o a n . The same c a l c u l a t i o n made f o r World Bank a i d shows a n e v e n m o r e severe d i s p l a c e m e n t e f f e c t . A m i l l i o n d o l l a r s i n W o r l d Bank a i d r e s u l t s i n o n l y a n e t i n c r e m e n t \ 39 t o s p e n d i n g of $222,000. I n r a t h e r s h a r p c o n t r a s t , i t a p p e a r s t h e W o r l d Bank e x t e n s i o n a i d h a s a l a r g e s t i m u l u s e f f e c t on e x t e n s i o n s p e n d i n g . 10 The a i d i n p u t s , i t m u s t be n o t e d , a r e d i f f i c u l t t o e s t i m a t e and t h i s w i l l l e a d some p o l i c y makers t o d i s c o u n t them. Most a i d d o n o r s , however, a r e p r e d i s p o s e d t o b e l i e v e t h a t t h e i r a i d h a s s u f f i c i e n t " s t r i n g s " t h a t i t w i l l n o t be d i s p l a c e d . it, i n f a c t , i s d i s p l a c e d and g e n e r a l l y d i s p l a c e m e n t e f f i c i e n t . When a c c o m p a n i e d by s t r o n g p o l i c y a d v i c e p r e s s u r e , a s i n t h e case o f World Bank e x t e n s i o n a i d s y s t e m ) , a i d can have a large effect. Yet, most of is probably and ( t h e T and V I t a p p e a r s t h e n t h a t t h e I A R C s y s t e m h a s had s i g n i f i c a n t and p o s i t i v e i m p a c t on n a t i o n a l r e s e a r c h ( a n d e x t e n s i o n ) p r o g r a m s i n t h e developing world. I t h a s s t i m u l a t e d more s p e n d i n g i n n a t i o n a l s y s t e m s and t h i s i m p a c t i s s u f f i c i e n t l y l a r g e t h a t a n a i d d o n o r i n t e r e s t e d i n s t i m u l a t i n g n a t i o n a l research s p e n d i n g a c t u a l l y received more s t i m u l u s from a g r a n t t o t h e I A R C s y s t e m t h a n from a d i r e c t g r a n t t o a n a t i o n a l s y s t e m . T h e I A R C s y s t e m h a s p r o b a b l y a l s o h a d a s i g n i f i c a n t i m p a c t on more q u a l i t a t i v e a s p e c t s o f n a t i o n a l research s y s t e m s a s well. 41 5 I m p a c t of I n v e s t m e n t o n P r o d u c t i v i t y A l a r g e n u m b e r of s t u d i e s s h o w i n g r e l a t i o n s h i p s b e t w e e n a g r i c u l t u r a l p r o d u c t i v i t y c h a n g e s and i n v e s t m e n t i n a g r i c u l t u r a l r e s e a r c h programs i n s p e c i f i c c o u n t r i e s h a v e n o t been u n d e r t a k e n ( N o r t o n and D a v i s , 1981 and R u t t a n , 1 9 8 4 p r o v i d e r e v i e w s ) . However, i n s p i t e o f t h e v o l u m i n o u s l i t e r a t u r e o n t h e " g r e e n r e v o l u t i o n , " p a r t o f w h i c h was a s s o c i a t e d w i t h I n t e r n a t i o n a l A g r i c u l t u r a l Research Center ( I A R C ) i n v e s t m e n t s , l i t t l e s y s t e m a t i c s t u d y o f I A R C i m p a c t o n p r o d u c t i v i t y h a s b e e n made. T h i s i s i n p a r t b e c a u s e t h e i m p a c t of a n I A R C i s i n t e r n a t i o n a l i n c h a r a c t e r . Some s t u d i e s o f p r o d u c t i v i t y i n a p a r t i c u l a r c o u n t r y ( E v e n s o n , 1983, f o r I n d i a ) h a v e i n f e r r e d I A R C i m p a c t on t h e b a s i s o f IARC-based h i g h y i e l d i n g v a r i e t y (HYV) d a t a . T h i s , h o w e v e r , d o e s n o t c a p t u r e t h e f u l l I A R C i m p a c t b e c a u s e much o f i t i s c h a n n e l e d t h r o u g h a v e n u e s o t h e r t h a n HYVs and b e c a u s e it o c c u r s i n a number of c o u n t r i e s . T h i s s e c t i o n r e p o r t s e c o n o m e t r i c e s t i m a t e s of i m p a c t s on c r o p p r o d u c t i v i t y o f n a t i o n a l i n v e s t m e n t i n c r o p - s p e c i f i c research, I A R C r e s e a r c h on t h e c o m m o d i t y , a n d n a t i o n a l investment i n extension. 5.1 S p e c i f i c a t i o n of t h e P r o d u c t i v i t y R e l a t i o n s h i p S i n c e t h e f o c u s of t h i s s e c t i o n i s o n I A R C e f f e c t s , c e r t a i n d a t a l i m i t a t i o n s w i l l h a v e t o be accepted. I t w i l l b e n e c e s s a r y t o p o o l d a t a from s e v e r a l c o u n t r i e s . F u r t h e r , i t w i l l b e necessary t o deal w i t h commodity-specific d a t a s i n c e t h e i n t e r e s t i s i n p a r t i c u l a r I A R C programs rather t h a n i n t h e i r g e n e r a l o r average i m p a c t . T h i s means t h a t t h e o n l y r e a l c r o p - s p e c i f i c p r o d u c t i v i t y v a r i a b l e s which can be observed a r e measures of p r o d u c t i o n and a r e a h a r v e s t e d . I n addition it is possible t o measure i r r i g a t e d area of a l l crops r e l a t i v e t o a l l h a r v e s t e d area and f e r t i l i z e r used. I t is n o t r e a l l y p o s s i b l e t h e n t o e s t i m a t e a f u l l p r o d u c t i o n f u n c t i o n o r t o compute a t o t a l f a c t o r p r o d u c t i v i t y i n d e x by crop f o r each country. The p r a c t i c a l a l t e r n a t i v e o p t i o n s a r e t o e s t i m a t e one of t h e f o l l o w i n g s p e c i f i c a t i o n s : ( 1 ) PROD/HA = a+bHA=cI*+dF*+eR (2) L N ( P R O D 1 = a l + b l L N ( H A ) + c l L N ( I * ) + d ' L N ( F * ) + e l R where PROD i s p r o d u c t i o n i n m e t r i c t o n s . HA is h e c t a r e s h a r v e s t e d . I* i s t h e r a t i o of i r r i g a t e d a r e a t o p l a n t e d a r e a f o r c r o p s t h a t a r e normally i r r i g a t e d . F* is t h e r a t i o of f e r t i l i z e r used ( v a l u e d a t c o n s t a n t w o r l d p r i c e s ) t o a c r e a g e of c r o p s normally f e r t i l i z e d . R i s a v e c t o r of r e s e a r c h - e x t e n s i o n v a r i a b l e s . These s p e c i f i c a t i o n s a r e p r o d u c t i o n f u n c t i o n llproxies.n The v a r i a b l e , HA, a c t u a l l y h a s t h r e e r o l e s i n t h e s p e c i f i c a t i o n s : ( a ) I t measures p r o d u c t i v e s e r v i c e s from land ( b ) I t measures land e x p a n s i o n - c o n t r a c t i o n e f f e c t s ( i . e . , where land q u a l i t y f o r new p l a n t i n g may d i f f e r from t h e a v e r a g e land q u a l i t y f o r t h e commodity) (c) I t is c o r r e l a t e d w i t h o t h e r " l e f t o u t " i n p u t s s u c h a s l a b o r and machine s e r v i c e s a n d i t may t h u s "pick-up" their effects. , This s t u d y is n o t d i r e c t l y i n t e r e s t e d i n t h e e s t i m a t e s of a', b ' , c ' , o r d ' ( o r a , b , c t and d ) u. Nor i s t h e e x a c t f u n c t i o n a l form of t h e p r o d u c t i o n f u n c t i o n an i m p o r t a n t i s s u e s i n c e n o a t t e m p t w i l l b e made t o i n t e r p r e t c o e f f i c i e n t s a s t e c h n i c a l s u b s t i t u t i o n parameters. The d a t a a v a i l a b l e a r e n o t The s u i t e d t o addressing t h e s e r e l a t i v e l y f i n e questions. p r i m a r y concern i s w i t h e s t i m a t e s o f t h e e' v e c t o r o f c o e f f i c i e n t s on t h e r e s e a r c h - e x t e n s i o n v a r i a b l e s . Option (2) above i s chosen a s t h e more r e a s o n a b l e s p e c i f i c a t i o n because l ' e f t - o u t unmeasured i n p u t s a r e l i k e l y t o be p r o p o r t i o n a l t o cropped a r e a (HA). The c o e f f i c i e n t b1 would, of c o u r s e , n o t be an e s t i m a t e o f t h e m a r g i n a l p r o d u c t o f l a n d i n t h a t c a s e r b u t a s n o t e d r t h a t is n o t of d i r e c t concern. The log- 43 l i n e a r r e l a t i o n s h i p b e t w e e n t h e r e s e a r c h - e x t e n s i o n v a r i a b l e s and p r o d u c t i o n i s a l s o c o n s i s t e n t w i t h some e v i d e n c e o f r e s e a r c h p r o d u c t i v i t y . Griliches (1958) found t h a t h y b r i d c o r n v a r i e t i e s tended t o improve y i e l d s p r o p o r t i o n a t e l y rather t h a n a d d i t i v e l y . The I* and F* v a r i a b l e s a r e i n c l u d e d o n l y f o r t h o s e c r o p s t h a t are either i r r i g a t e d or f e r t i l i z e d . These v a r i a b l e s a r e n o t m e a s u r e d on a c r o p - s p e c i f i c b a s i s , b u t t h e y a r e l i k e l y t o b e p r o p o r t i o n a l t o a c t u a l crop-specific v a r i a b l e s and hence t h e i r inclusion can reduce bias. Thus " c o u n t r y e f f e c t s " s u c h a s s o i l and c l i m a t e f a c t o r s , m e a s u r e m e n t e r r o r s , i n f r a s t r u c t u r e , etc., t h a t a f f e c t p r o d u c t i o n o r y i e l d l e v e l s , b u t n o t t h e i r c h a n g e o v e r time, a r e p i c k e d u p by t h e s e dummy v a r i a b l e s . S p e c i f i c a t i o n s t h a t p o o l commodities a l s o i n c l u d e commodity dummy v a r i a b l e s , S i m u l t a n e i t y p r o b l e m s may e x i s t i f n a t i o n a l r e s e a r c h and e x t e n s i o n program i n v e s t m e n t r e s p o n d s t o both p r o d u c t i o n and area (i*e., t o y i e l d ) . A number of s t u d i e s h a v e d e a l t w i t h t h i s b y s i m p l y a r g u i n g t h a t t h e r e l a t i o n s h i p i s ltrecursive.ll That is, c u r r e n t research i n v e s t m e n t may r e s p o n d t o c u r r e n t y i e l d performance, b u t c u r r e n t y i e l d s are responding t o p a s t research i n v e s t m e n t s . I n t h i s s t u d y , t h e p r o b l e m w i l l be d e a l t w i t h f o r m a l l y b y u t i l i z i n g t h e t w o s t a g e l e a s t s q u a r e s ' e s t i m a t e s from Table 11 t o c o n s t r u c t t h e research v a r i a b l e . The a c t u a l v a r i a b l e s s p e c i f i e d t o t h i s s t u d y a r e d e f i n e d a s follows: A l l s p e c i f i c a t i o n s i n c l u d e c o u n t r y dummy v a r i a b l e s . where R i t i s me d i c t e d r e s e a r c h s p e n d i n g i n t i m e t. T h e p r e d i c t i o n i s based on t h e i n v e s t m e n t a n a l y s i s reported i n Table 1 The w e i g h t s u s e d were i n d i r e c t l y e s t i m a t e d by c o n s t r u c t i n g 44 a n a l t e r n a t i v e s t o c k u s i n g w e i g h t s r i s i n g t o o n e by y e a r t + 9. T h i s s t o c k was s l i g h t l y i n f e r i o r t o t h e s p e c i f i e d s t o c k . EXTDIV = ( . t E X T t +.25EXTt-l + .25EXTt_2)DIVER where E X T t i s a c t u a l s p e n d i n g i n 1980 d o l l a r s on a l l a g r i c u l t u r a l extension. c S $ where S i i s t h e s h a r e o f t o t a l production o f a s p e c i f i c commodity i n a s p e c i f i c g e o - c l i m a t e r e g i o n . L i v e s t o c k c o m m o d i t i e s are i n c l u d e d i n t h e c o n s t r u c t i o n o f DIVER. Note t h a t t h e w e i g h t s f o r E X T D I V sum t o o n e i m p l y i n g t h a t n o l o n g t e r m i m p a c t f r o m extension i s r e a l i z e d . The f u l l i m p a c t i s r e a l i z e d by t h e e n d o f y e a r t + 2 . 1959 DIVER = where I A R C t i s s p e n d i n g b y t h e I A R C i n 1980 d o l l a r s i n time t . The f o l l o w i n g " i n t e r a c t i o n " v a r i a b l e s were d e f i n e d : EXTDIV = EXTDIV*PRESI INTRPRES = INTR*PRESI INTREXT = INTR*EXTDIV One f u r t h e r m o d i f i c a t i o n was made t o t a k e i n t o a c c o u n t t h e f a c t t h a t I A R C i m p a c t s a r e n o t l i k e l y t o b e t h e same i n a l l c o u n t r i e s i n t h e d a t a s e t . I t would be, a s a p r a c t i c a l m a t t e r ? n e a r l y i m p o s s i b l e t o I A R C p r o g r a m s t o p r o d u c e t h e same p r o d u c t i o n i m p a c t i n e a c h o f t h e 2 4 c o u n t r i e s i n t h e d a t a s e t . The I A R C s w i l l i n m o s t c a s e s b e p r o d u c i n g t e c h n o l o g y t h a t i s more c l o s e l y matched t o producing e n v i r o n m e n t s s i m i l a r t o i t s h o s t c o u n t r y than t o environments t h a t a r e d i s s i m i l a r . This should not only a f f e c t t h e p r o d u c t i v i t y i m p a c t of t h e I A R C p r o g r a m b u t i t s i n t e r a c t i o n w i t h n a t i o n a l r e s e a r c h and e x t e n s i o n programs a s well. To a t t e m p t t o t a k e t h i s i n t o a c c o u n t ? a v a r i a b l e , SRI i s defined. T h i s v a r i a b l e i s equal t o t h e p r o p o r t i o n o f t h e a r e a 45 p l a n t e d t o t h e commodity i n t h e c o u n t r y o f o b s e r v a t i o n t h a t is l o c a t e d i n t h e same g e o - c l i m a t e r e g i o n a s t h e I A R C s c e n t r a l l o c a t i o n . The g e o - c l i m a t e r e g i o n s a r e d e f i n e d by P a p a d a k i s ( 1 9 6 5 ) a n d have b e e n u s e d i n o t h e r s t u d i e s o f i n t e r n a t i o n a l p r o d u c t i v i t y i m p a c t ( E v e n s o n e t a l . ~ 1979, E v e n s o n r 1983). The f o l l o w i n g v a r i a b l e s were t h e n d e f i n e d : INTRSR = INTR*SR INTRESSR = INTRPRES*SR INTREXSR = INTREXT*SR The c o e f f i c i e n t s o f t h e s e v a r i a b l e s measure a d d e a i m p a c t s i n s i m i l a r g e o - c l i m a t e r e g i o n s . The r e a s o n i n g o f f e r e d a b o v e would lead t o t h e expectation t h a t direct IARC impact via t h e provision o f m a t c h e d t e c h n o l o g y w i l l be h i g h e r i n s i m i l a r r e g i o n s D w h i l e t h e indirect impact v i a t h e p r o v i s i o n o f mismatched technology c o u l d be l a r g e r o u t s i d e t h e s i m i l a r r e g i o n . I t i s p o s s i b l e D o f c o u r s e r t h a t b o t h e f f e c t s w i l l be l a r g e r i n s i m i l a r r e g i o n s . 5.2 P r o d u c t i v i t y Impact E s t i m a t e s , I The e c o n o m e t r i c a n a l y s i s proceeded i n t h r e e s t a g e s . In the first stage t h e p r e d i c t i n g equations required f o r building t h e r e s e a r c h s t o c k v a r i a b l e s were e s t i m a t e d ( d i s c u s s e d i n P a r t I11 a b o v e ) . I n t h e s e c o n d , c r o p p r o d u c t i v i t y s p e c i f i c a t i o n s were e s t i m a t e d f o r e a c h o f t h e 10 c o m m o d i t i e s i n t h e s t u d y u s i n g d a t a f o r a l l 24 c o u n t r i e s . I n t h e t h i r d s t a g e D r e g i o n a l e s t i m a t e s f o r Asiar Af rica and L a t i n America were q b t a i n e d f o r m a i z e D m i l l e t s and sorghum p o o l e d D a l l c e r e a l s p o o l e d a n d a l l s t a p l e c r o p s pooled . The r e s u l t s f o r s t a g e t w o a r e s u m m a r i z e d i n T a b l e 13. T a b l e 13 r e p o r t s t h e c o e f f i c i e n t s of t h e i n t e r a c t i o n terms i n t h e model and t h e c o m p u t e d p a r t i a l p r o d u c t i o n e l a s t i c i t i e s commodity. T h e f u l l r e g r e s s i o n s r e q u i r e o v e r 20 present. Copies a r e a v a i l a b l e from t h e author. r e g r e s s i o n s a r e p o o l e d a c r o s s m a i z e r s o r g h u m and f o r each tables t o A l l commodity milletsr a l l Table 13 Estimated Crop P r o d u c t i o n E l a s t i c i t i e s (Computed a t t h e Mean) by Commodity, 2 4 C o u n t r i e s , 1962-80 In terac t i o n Ef fec ts IARC Res X NRES COMMENTS IARC X NEXT N a t i o n a l Res Added GCSR NRES X NEXT Added GCS R Added General GCSR General -.743(7) -.139(2) .212(5) Production E l a s t i c i t i e s N a t i o n a l Ext IARC Res Added Added General CCSR G e n x r u s ! j R I ;cneral, .0733* -.019* .432. -.067 .Maize Millets Sorghum Maize Sorghum. Millets Rice Wheat Cereals Beans Cassava C roundnu t -.448(3) * - .222 (5) * -.139 (6) .440(3)** -.251(2)** -.197(3) -.252(4)* -.154(4)* .368(5)** .596(5) .349(5) -.167(3)* -.0234 -.065 -.096* * .018 .006 .188** .136 .728 2.75M .340** .ooo -.019* B P Q\ . .068** -1.41 -.336(3) ** -.433(6) ** .349(8) -.205(5) ** - .395 (4) 379(6) * -.336(6) ** -.986(5) ** 322(3)** -.799 (7) -.159( 7) -.181(6) * -* -.109(2)** -.228(5) .416(6)** .428(5)** -.139(6) -.472(6)** .718(8) .899(6) -.911(6) ,582 ( 5 ) * -.632(7) -.525(6) .079 .120** .219(6)** -.lo2 .336 ,050 -.064 .416 .141 -.001 ** 9: .075** -.361** -.622** .036* -.246 -.236** .091 .192** .ow** .091** .004 .048** -.008* .240* .029** -.002 .271** .058** -.031* .419** .045* .015** .202 -.025 .a21 .189** .044** .027** .056** -.OH *268(3) 195(2) ** -.758(3) -*805(3) *947(2)** .531(4) -.362(5) ** .548(5) * - .170 (5) -.776(5) ** -.111(4)** .E59 (6) -.823(5) -.167(5) ** .030** .099** .054** -.059** -.062 .067** .101* .097* Potatoes Sweet Potatoes Staples Notes: -.696(6) -.123(3) -.418(4)** .001* .031** ** .753( 7) .774(5) -.598(5)** -.385(4)** .364(5)** .232 .008** .111(5)** -.034 ** -.35** - .loa** .073** .095** -.010 * **"t" t II N u d e r in p a r e n t h e s i s a r e E(-n) o r comparable "I?' i n d i c a t e s s i g n i f i c a n c e a t t h e 5 t o 10 p e r c e n t l e v e l . II or comparable "F" i n d i c a t e s s i g n i f i c a n c e a t t h e 5 p e r c e n t or lower l e v e l . 47 c e r e a l s and a l l s t a p l e s and show more s t a b l e and c o n s i s t e n t elasticity estimates. It i s i m p o r t a n t t o b e a r i n mind t h a t most s t u d i e s o f r e s e a r c h p r o d u c t i v i t y i m p a c t s a r e i n f a c t b a s e d on aggregated o r pooled d a t a . Consider f i r s t t h e i n t e r a c t i o n effects. The f i r s t column o f T a b l e 13 s h o w s t h a t n a t i o n a l r e s e a r c h and e x t e n s i o n p r o g r a m s a r e substitutes i n the cereals. IARC research is a l s o a s u b s t i t u t e f o r e x t e n s i o n i n r i c e and w h e a t i n s i m i l a r g e o - c l i m a t e r e g i o n s . T h i s means t h a t s p e n d i n g more on e x t e n s i o n l o w e r s t h e m a r g i n a l p r o d u c t o f r e s e a r c h a n d s p e n d i n g more on r e s e a r c h l o w e r s t h e marginal product o f extension. For s t a p l e s , it appears t h a t n a t i o n a l r e s e a r c h c o m p l e m e n t s e x t e n s i o n i n c a s s a v a and sweet p o t a t o e s where I A R C r e s e a r c h h a s n ' t been e f f e c t i v e . Where I A R C r e s e a r c h has been e f f e c t i v e ( a s i n c a s s a v a i n s i m i l a r r e g i o n s ) i t t e n d s t o be a s u b s t i t u t e f o r n a t i o n a l e x t e n s i o n . I t a p p e a r s t h a t w i t h t h e e x c e p t i o n o f t h e maize-sorghummillets combination, I A R C r e s e a r c h h a s e i t h e r no s i g n i f i c a n t interaction with extension o r it has a negative substitution interaction. The s t o r y t h a t I A R C r e s e a r c h e n h a n c e s t h e p r o d u c t i v i t y o f n a t i o n a l e x t e n s i o n programs is n o t g e n e r a l l y t o l d by t h e s e d a t a . The i n t e r a c t i o n s o f I A R C r e s e a r c h w i t h n a t i o n a l r e s e a r c h s y s t e m s a r e a l s o somewhat mixed. They a r e p o s i t i v e f o r sorghum, b e a n s , a n d s t a p l e s g e n e r a l l y and n e g a t i v e f o r w h e a t , c a s s a v a , p o t a t o e s and sweet p o t a t o e s . T h e I A R C e f f e c t i n s i m i l a r r e g i o n s i s n e g a t i v e f o r m a i z e , s o r g h u m , r i c e , b e a n s and s t a p l e s generally. It i s p o s i t i v e o n l y f o r wheat. This result is c o n s i s t e n t w i t h t h e arguments regarding t h e matching o f t e c h n o l o g y . T e c h n o l o g y f r o m t h e I A R C s s h o u l d b e more h i g h l y matched t o s i m i l a r s u b r e g i o n s . a n d t h i s s h o u l d be m a n i f e s t e d i n l o w e r IARC-NRES i n t e r a c t i o n s i n s i m i l a r r e g i o n s t h a n i n g e n e r a l . Wheat i s , t h e o n l y c a s e w h e r e t h e i n t e r a c t i o n i s m a r g i n a l l y s i g n i f i c a n t l y h i g h e r i n similar regions. It h a s a s t r o n g l y 48 n e g a t i v e e x t e n s i o n i n t e r a c t i o n , however, where t h e same argument can b e a p p l i e d . Note t h a t , f o r e x t e n s i o n , t h e I A R C - N E X T i n t e r a c t i o n i s g e n e r a l l y lower i n s i m i l a r regions. O f t h e 2 4 I A R C i n t e r a c t i o n c o e f f i c i e n t s i n Table 1 3 f o r s i m i l a r r e g i o n s , 17 a r e n e g a t i v e , and 12 a r e s i g n i f i c a n t l y negative. O n l y one h a s a marginally s i g n i f i c a n t p o s i t i v e c o e f f i c i e n t . These r e s u l t s provide g e n e r a l s u p p o r t f o r t h e u n d e r l y i n g l o g i c o f specifications. The production e l a s t i c i t i e s a r e " p a r t i a l " e l a s t i c i t i e s . e l a s t i c i t y f o r n a t i o n a l r e s e a r c h shows t h e p e r c e n t change i n The production a s s o c i a t e d w i t h a 1 p e r c e n t change i n t h e n a t i o n a l r e s e a r c h s t o c k , h o l d i n g n a t i o n a l e x t e n s i o n , I A R C r e s e a r c h and o t h e r v a r i a b l e s i n t h e e q u a t i o n c o n s t a n t . These e l a s t i c i t i e s a r e f u n c t i o n s o f t h e l e v e l s o f o t h e r v a r i a b l e s because o f t h e i n t e r a c t i o n terms i n t h e equations. T h e y a r e e v a l u a t e d a t t h e mean of t h e d a t a s e t . An 'IFw t e s t i s undertaken t o t e s t f o r t h e j o i n t s t a t i s t i c a l s i g n i f i c a n c e of t h e c o e f f i c i e n t s e n t e r i n g t h e marginal production ( a n d t h e computed e l a s t i c i t y ) . The e l a s t i c i t i e s a r e computed f o r c o u n t r i e s o u t s i d e s i m i l a r r e g i o n s and t h e i n c r e m e n t a l e l a s t i c i t y f o r s i m i l a r r e g i o n s i s a l s o shown 12 . The I A R C e l a s t i c i t i e s a r e computed on a presumption t h a t IARCimpacts w i l l be r e a l i z e d i n a l l 2 4 c o u n t r i e s i n t h e sample. 13 The e l a s t i c i t i e s b e a r a r e l a t i o n s h i p t o r a t e s o f r e t u r n on i n v e s t m e n t . Suppose t h a t a c o u n t r y i s p r e s e n t l y s p e n d i n g one h a l f of 1 percent of t h e v a l u e o f product on c e r e a l s r e s e a r c h . The e l a s t i c i t y e s t i m a t e f o r c e r e a l s , 0.058, i n d i c a t e s t h a t production w i l l i n c r e a s e b y 0.058 percent o r 0.00058 t i m e s t h e v a l u e o f production. T h u s an i n v e s t m e n t i n time t o f 1 p e r c e n t o f t h e v a l u e of product w i l l g e n e r a t e an income s t r e a m t h a t w i l l b e z e r o i n t i m e t , 0.2* x 0.00058V i n t + l r 0.4* x 0.00058V i n t + 2 , 0.6* x 0.00058V i n t+3, 0.8* x 0.00058V i n t + 4 , a n d 0.00058V 49 i n a l l y e a r s thereafter.14 The d i s c o u n t r a t e which e q u a t e s t h i s e a r n i n g s s t r e a m t o t h e i n i t i a l i n v e s t m e n t i s a p p r o x i m a t e l y 35 percent. T h i s is t h e i n t e r n a l r a t e of return t o t h e r e s e a r c h investment. Had t h e i n i t i a l r a t i o o f r e s e a r c h s p e n d i n g been o n l y 0.0025 i n s t e a d o f 0.005 t h e e a r n i n g s s t r e a m a s s o c i a t e d w i t h an e l a s t i c i t y o f 0.058 would h a v e y i e l d e d an i n t e r n a l r a t e o f r e t u r n s l i g h t l y o v e r 60 p e r c e n t . The r a t i o s o f r e s e a r c h s p e n d i n g t o t h e v a l u e of p r o d u c t f o r t h e 1972-79 p e r i o d by c o m m o d i t y were: w h e a t 0.0051, r i c e 0.0025, m a i z e - s o r g h u m - m i l l e t s 0.0023, c a s s a v a 0.001 1 , b e a n s 0.0032, p o t a t o e s 0.0029, s w e e t p o t a t o e s 0.0007 and g r o u n d n u t s 0.0025. Table 14 shows t h e c o n v e r s i o n o f e l a s t i c i t i e s f o r b o t h r e s e a r c h and e x t e n s i o n t o i n t e r n a l r a t e s o f r e t u r n f o r d i f f e r e n t r a t i o s o f s p e n d i n g t o v a l u e o f p r o d u c t . The low i n c o m e c o u n t r i e s i n t h e s a m p l e had a r a t i o o f e x t e n s i o n s p e n d i n g t o v a l u e o f p r o d u c t 0.005. F o r t h e h i g h e r income c o u n t r i e s i t was 0.0075. W i t h t h e s e c o n v e r s i o n s , t h e r e a d e r c a n see t h a t n a t i o n a l 1 r e s e a r c h investment h a s y i e l d e d g e n e r a l l y h i g h returns. National e x t e n s i o n i n v e s t m e n t , a s t h e t a b l e s h o w s , m u s t h a v e above 0.059 t o y i e l d a return o f 10 p e r c e n t , u n d e r an a s s u m p t i o n t h a t i t s i m p a c t does n o t l a s t beyond t h r e e p e r i o d s . 1 5 Extension impacts on c e r e a l g r a i n p r o d u c t i v i t y and on p o t a t o e s and s w e e t p o t a t o e s p r o d u c t i v i t y a p p e a r t o b e l a r g e enough t o J u s t i f y i n v e s t m e n t a t t h e l o w e r l e v e l s . Given t h e n a t u r e o f t h e v a r i a b l e u s e d , p e r h a p s t h e most r e a s o n a b l e e s t i m a t e is f o r t h e pooled c e r e a l g r a i n s . T h i s e l a s t i c i t y i s s u f f i c i e n t t o j u s t i f y around one h a l f o f 1 p e r c e n t on e x t e n s i o n . Many c o u n t r i e s , h o w e v e r , a r e c u r r e n t l y s p e n d i n g r o u g h l y 1 percent o f t h e v a l u e of p r o d u c t on e x t e n s i o n . The e s t i m a t e f o r c e r e a l g r a i n s does n o t j u s t i f y an i n v e s t m e n t of t h i s magnitude.16 The e s t i m a t e s f o r b o t h n a t i o n a l r e s e a r c h and e x t e n s i o n s h o u l d be i n t e r p r e t e d w i t h some c a u t i o n . T h e p r o d u c t i v i t y and effectiveness of b o t h r e s e a r c h and e x t e n s i o n p r o g r a m s v a r i e s f r o m Table 14 I n t e r n a l Rates o f R e t u r n C o r r e s p o n d i n g t o G i v e n Research a n d E x t e n s i o n E l a s t i c i t i e s a t Selected Ratios of Spending t o P r o d u c t i v i t y C o m p a r a b l e Research E l a s t i c i t y R a t i o of S p e n d i n g t o P r od u c t i v i t v .0003 .0025 .005 .01 -0006 -0015 -0025 -0043 .0051 -0066 -0081 -0113 -0131 -005 -0122 .0212 .0353 .0416 -0547 -0675 -0808 -1088 0010 -0243 -0421 -0766 -0851 -1094 -1350 -1616 -2175 Corn pa r a b 1e E x t e n s i o n Elasticity Ratio of Sp .en .ding t o PrQ$uctivitv .005 .0075 Internal R a t e of Return 10% 20% 30% 40% 50% 60% 70% 801 1001 0200 -0468 .0841 -1412 -1702 -2188 -2700 -3230 -4350 -059 -068 -077 -087 -096 .lo6 -116 -126 -146 -088 0102 -116 -131 145 -159 174 -189 -219 v, 0 51 c o u n t r y t o c o u n t r y b e c a u s e of o r g a n i z a t i o n , l e a d e r s h i p a n d g e n e r a l p o l i t i c a l and economic c o n d i t i o n s . S t u d i e s i n s p e c i f i c c o u n t r i e s are r e q u i r e d t o i n v e s t i g a t e these i s s u e s f u r t h e r . The chief reason for r e s o r t i n g t o i n t e r n a t i o n a l data i n t h i s study is t h a t I A R C impacts a r e i n t e r n a t i o n a l i n character and c a n n o t e a s i l y be measured i n d a t a f o r a s i n g l e c o u n t r y . The p r o d u c t i o n e l a s t i c i t i e s f o r I A R C i n v e s t m e n t f o r t h e p o o l e d m a i z e - m i l l e t s - s o r g h u m d a t a and f o r p o o l e d c e r e a l s show t h a t I A R C i n v e s t m e n t h a s a n e l a s t i c i t y o f 0.027 f o r t h e d e v e l o p i n g w o r l d i n g e n e r a l and a c o n s i d e r a b l y h i g h e r e l a s t i c i t y f o r c o u n t r i e s i n s i m i l a r r e g i o n s . T h i s i m p a c t is e s s e n t i a l l y t h e " g r e e n r e v o l u t i o n " i m p a c t . I t i m p l i e s a v e r y h i g h r a t e of r e t u r n b e c a u s e t h e r a t i o of I A R C s p e n d i n g t o t h e v a l u e of t h e p r o d u c t i s l o w , r a n g i n g from 0.0003 f o r t h e c e r e a l s t o 0.0008 f o r p o t a t o e s . T h u s a n e l a s t i c i t y of 0.017 i m p l i e s a n i n t e r n a l r a t e of r e t u r n of 100 p e r c e n t . T h e s e h i g h r a t e s of r e t u r n a r e r of c o u r s e r b a s e d o n t h e fact t h a t t h e IARC impact occurs n o t j u s t i n one country but i n t h e e n t i r e region. Because t h e spending t o product r a t i o s a r e low, these h i g h r e t u r n s i m p l y t h a t s u b s t a n t i a l g r o w t h i n p r o d u c t i v i t y i s p r o d u c e d by t h e I A R C s . I f I A R C s p e n d i n g w o u l d h a v e b e e n 20 p e r c e n t h i g h e r f o r c e r e a l g r a i n s a n d h a d t h e same e l a s t i c i t i e s h e l d ( a q u e s t i o n a b l e a s s u m p t i o n ) , p r o d u c t i o n o f c e r e a l g r a i n s would h a v e b e e n 0.027 x 0.2 = 0.0054 o r o n e h a l f p e r c e n t h i g h e r p e r y e a r ( a f t e r t h e f u l l i m p a c t is r e a l i z e d ) . T h i s i s a l a r g e g r o w t h i n c r e m e n t from a r e l a t i v e l y small investment. The r e s u l t s f o r I A R C i n v e s t r n e n t i n r i c e a r e a l i t t l e p u z z l i n g a s t h e y show v e r y h i g h r e t u r n s i n s i m i l a r r e g i o n s a n d none o u t s i d e these regions. It a l s o appears t h a t I A R C i n v e s t m e n t i n r i c e h a s s h a r p l y r e d u c e d t h e m a r g i n a l p r o d u c t s of n a t i o n a l research a n d e x t e n s i o n i n s i m i l a r r e g i o n s . T h e d e f i n i t i o n s of r e g i o n s f o r r i c e may b e a l i t t l e t o o b r o a d t o c a p t u r e t h e same e f f e c t s a s f o r o t h e r commodities. 52 For t h e s t a p l e crops, it appears t h a t there is an IARC i m p a c t i n a l l c o m m o d i t i e s e x c e p t sweet p o t a t o e s . F o r c a s s a v a , t h e i m p a c t i s c o n f i n e d t o s i m i l a r r e g i o n s . F o r b e a n s and p o t a t o e s , t h e i m p a c t e x t e n d s beyond s i m i l a r r e g i o n s . The r e t u r n s t o t h i s IARC research appear t o be a s high as f o r IARC research i n c e r e a l g r a i n s . G i v e n t h e v e r y h i g h leverage f a c t o r w i t h I A R C r e s e a r c h a l m o s t any m e a s u r a b l e i m p a c t ( i n a s t a t i s t i c a l sense) w i l l tend t o have a h i g h r a t e o f r e t u r n . The commodity-based r e s u l t s i n T a b l e 13 show t h a t p o o l e d commodity r e g r e s s i o n s t e n d t o b e more s y s t e m a t i c t h a n i n d i v i d u a l commodity r e g r e s s i o n s . T a b l e 1 4 r e p o r t s r e g i o n a l - b a s e d r e g r e s s i o n s for three pooled groups maize-sorghum-millets, c e r e a l s and s t a p l e s . A l l p o o l e d r e g r e s s i o n s i n c l u d e commodity and c o u n t r y dummy v a r i a b l e s . - T a b l e I5 d o e s n o t i n c l u d e t h e s i m i l a r r e g i o n v a r i a b l e s because t h e grouping o f c o u n t r i e s i n t o t h e three broad r e g i o n s a c h i e v e s some of t h e s a m e o b j e c t i v e s . T h i s t a b l e r e v e a l s p a t t e r n s somewhat more c l e a r l y t h a n d i d T a b l e 13. The n e g a t i v e n a t i o n a l r e s e a r c h - e x t e n s i o n i n t e r a c t i o n s , f o r example, emerge f o r e v e r y r e g i o n a n d every commodity group. T h e I A R C - n a t i o n a l r e s e a r c h i n t e r a c t i o n i s n e g a t i v e f o r c e r e a l c r o p s i n Asia and L a t i n America, b u t i s a c t u a l l y p o s i t i v e f o r s t a p l e c r o p s i n L a t i n America. The IARC-national e x t e n s i o n i n t e r a c t i o n s a r e g e n e r a l l y p o s i t i v e , e x c e p t i n s t a p l e c r o p s i n L a t i n America. T h e e s t i m a t e d p r o d u c t i v i t y e l a s t i c i t i e s a r e a l s o somewhat more r e g u l a r . N a t i o n a l r e s e a r c h i n v e s t m e n t s a r e h i g h l y p r o d u c t i v e , except i n Africa f o r c e r e a l g r a i n s (presumably r i c e a n d w h e a t ) and L a t i n America f o r s t a p l e s . I m p l i e d r a t e s o f return a r e h i g h . They r a n g e f r o m 30 t o 4 0 p e r c e n t f o r m a i z e i n L a t i n A m e r i c a a n d m a i z e a n d s t a p l e c r o p s i n A f r i c a t o 60 t o 7 0 p e r c e n t f o r m a i z e and c e r e a l s i n L a t i n A m e r i c a , c e r e a l s i n A s i a and s t a p l e crops i n A s i a . Table 15 Regional Impact Analysis Maize, Millets 6 Sorghum Re sea rchExtens ion Coefficient I ' Cereal Crops Latin America .0146** .0158** -.364(3)** .560( 5 ) * * Staple Crops Asia .0106** .0389** Latin America .0121** .0331** -.117(2)** .286(5) Africa .0393** Asia .0314** .0305** -.172(2)** .2 1 3 ( 6 ) Africa .854(3) Latin America -.019** -.493(2) .318( 3)** .237(4)** .685 ( 6 ) * -.737(6)* Af rica .0733** .939(2)** Asia .0479** .0157* -.457( 2)** .514 ( 5 ) .105(5) U I PRESS1 EXTDIV EXTDPRES INTRIARC INTRPRES INTRXEXT -.609 ( 4 ) - .153 ( 3 ) -.939(3)** .809 ( 5 ) .445 ( 6 ) -.2 2 8 ( 3 ) .319 ( 5 ) .157(7) .222(6)** -.597 ( 3 ) * * .171(5) -.1 0 1 ( 2 ) * .371(5) -.1 7 9 ( 6 ) .129 ( 5 ) -.103(5)** .349(5)** -.1 9 3 ( 6 ) * * .SO1 ( 7 ) -.644( 7)** .755(6)* -.2 2 8 ( 5 ) .653(6) ** .178 ( 6 ) .188 ( 5 ) w PRODUCTIVITY ELASTICITIES National Research Na t ional Extension IARC Research ~ ~~~ .0344 .0505** .1168** .1435** -.(IO60 .1135** -.@302** .0313** .1292** .0685 .1708* -.0129 .0355** .1658** .0745** ,0128 .1921** -.0243** ** .1198** .0317* .0416** .0298** .0543** .0428** .0412** .0187 .0312* Note: Numbers in parentheses are E(-n). "T" or comparable "F" indicate significance at 5 to 10 percent levels. I1 T11 or comparable "F" indicate significance at 5 percent or lower level. 54 National i n v e s t m e n t i n e x t e n s i o n programs a l s o generally a p p e a r s t o be p r o d u c t i v e , e x c e p t i n s t a p l e s i n L a t i n America and m a i z e i n A f r i c a . The e l a s t i c i t i e s a r e h i g h enough t o j u s t i f y a s p e n d i n g t o v a l u e r a t i o of 1/2 t o 1 percent b u t n o t much h i g h e r . I A R C i n v e s t m e n t is p r o d u c t i v e a c r o s s t h e board. The e l a s t i c i t i e s f o r c e r e a l c r o p s a r e h i g h e s t i n A f r i c a and l o w e s t i n L a t i n America. The reverse i s t r u e f o r s t a p l e s . The elasticities imply high i n t e r n a l rates of return t o IARC i n v e s t m e n t , g e n e r a l l y i n e x c e s s o f 100 p e r c e n t everywher.e. A s a r e g i o n , Asia d o e s b e s t w i t h h i g h p r o d u c t i v i t y e l a s t i c i t i e s f o r a l l three forms o f i n v e s t m e n t f o r a l l c o m m o d i t i e s . L a t i n A m e r i c a h a s b e n e f i t e d f r o m a l l investments except i n s t a p l e s . A f r i c a h a s m i x e d r e s u l t s . I A R C i n v e s t m e n t h a s been l e a s t p r o d u c t i v e i n s t a p l e s . N a t i o n a l i n v e s t m e n t h a s been most p r o d u c t i v e i n t h e s t a p l e c r o p s . 55 6 Policy Implications of Productivity Analysis T h i s p a p e r shows, a s d o many o t h e r s , t h a t r e s e a r c h d i r e c t e d toward t h e d i s c o v e r y a n d d e v e l o p m e n t of new a g r i c u l t u r a l t e c h n o l o g y h a s a h i g h p a y o f f i n terms o f p r o d u c t i v i t y g r o w t h . Not a l l r e s e a r c h p r o g r a m s a r e s u c c e s s f u l , of c o u r s e . I n some c a s e s , r e l a t i v e l y new r e s e a r c h p r o g r a m s may n o t b e p r o d u c t i v e u n t i l a s i g n i f i c a n t period of t r i a l - a n d - e r r o r with s c i e n t i f i c approaches and a d m i n i s t r a t i v e and o r g a n i z a t i o n a l change takes place. Most I A R C p r o g r a m s a r e s t i l l q u i t e young. P r e v i o u s s t u d i e s h a v e documented h i g h p r o d u c t i v i t y of I A R C research programs i n wheat and r i c e , b u t r e l a t i v e l y l i t t l e s y s t e m a t i c s t u d y of impact o n o t h e r commodities h a s b e e n u n d e r t a k e n . The c h i e f o b j e c t i v e of t h i s s t u d y was t o u s e i n t e r n a t i o n a l crop p r o d u c t i v i t y d a t a t o measure I A R C impacts i n t e n commodities. C e r t a i n d a t a l i m i t a t i o n s h a d t o be a c c e p t e d i n d o i n g s o a n d t h i s s t u d y i s n o t a s u b s t i t u t e f o r more d e t a i l e d c o u n t r y s t u d i e s . N o n e t h e l e s s , t h e s t u d y d i d i d e n t i f y a n d measure s i g n i f i c a n t I A R C i m p a c t s a s w e l l a s n a t i o n a l research a n d e x t e n s i o n i m p a c t s on c r o p p r o d u c t i v i t y . I n a d d i t i o n i t i d e n t i f i e d s e v e r a l i n t e r a c t i o n a n d r e g i o n a l i m p a c t s of i n t e r e s t . (The s t u d y a l s o a t t e m p t e d t o deal w i t h t h e s i m u l t a n e o u s r e l a t i o n = s h i p b e t w e e n p r o d u c t i v i t y a n d research a n d e x t e n s i o n i n v e s t m e n t ) . The major f i n d i n g s were: (1) I (2) Measurable p o s i t i v e I A R C i m p a c t s o n c r o p p r o d u c t i v i t y were o b s e r v e d f o r a l l c o m m o d i t i e s e x c e p t sweet p o t a t o e s . F o r p o o l e d commodity g r o u p s , g r a i n s , c e r e a l s and s t a p l e s , p o s i t i v e I A R C i m p a c t s were m e a s u r e d f o r a l l g r o u p s i n a l l r e g i o n s . Computed r a t e s o f r e t u r n t o I A R C i n v e s t m e n t a r e very high. I A R C i m p a c t s a r e h i g h e r i n c o u n t r i e s i n t h e same geo-climate r e g i o n a s t h e I A R C c e n t r a l l o c a t i o n . I n most c o m m o d i t i e s t h e s e I A R C i m p a c t s l o w e r t h e m a r g i n a l p r o d u c t of b o t h n a t i o n a l r e s e a r c h a n d n a t i o n a l e x t e n s i o n programs. The 56 I A R C s p r o d u c e t e c h n o l o g y t h a t t o some e x t e n t s u b s t i t u t e s f o r t h e p r o d u c t s of n a t i o n a l r e s e a r c h and e x t e n s i o n . O u t s i d e s i m i l a r geo-climate r e g i o n s , I A R C i m p a c t s complement n a t i o n a l r e s e a r c h p r o g r a m s i n some c o m m o d i t i e s , ( m a i z e , r i c e , b e a n s ) and s u b s t i t u t e f o r o t h e r s . N a t i o n a l r e s e a r c h investment i s h i g h l y p r o d u c t i v e i n most c o m m o d i t i e s and i n m o s t r e g i o n s . I n t e r n a l r a t e s o f r e t u r n t o i n v e s t m e n t r a n g e f r o m 30 t o 70 p e r c e n t f o r m o s t commodities. N a t i o n a l research h a s a c o n s i s t e n t n e g a t i v e i n t e r a c t i o n w i t h national extension. Higher r e s e a r c h spending r e d u c e s t h e impact of e x t e n s i o n s e r v i c e s . It appears t h a t most e x t e n s i o n services a r e n o t o r g a n i z e d t o d i r e c t l y c h a n n e l o r d i f f u s e research products t o farmers. Extension services a r e a l s o g e n e r a l l y p r o d u c t i v e a l t h o u g h t h e i r i m p a c t s a r e much more v a r i a b l e . Rates of r e t u r n c a l c u l a t i o n s show t h a t few p r o g r a m s h a v e b e e n p r o d u c t i v e enough t o j u s t i f y e x t e n s i o n spending-to-product r a t i o s above 1 percent. The first p a r t o f t h i s s t u d y e x a m i n e d t h e impact o f I A R C i n v e s t m e n t on n a t i o n a l r e s e a r c h i n v e s t m e n t . I t c o n c l u d e d t h a t I A R C investment s t i m u l a t e d n a t i o n a l r e s e a r c h i n v e s t m e n t i n m o s t c o m m o d i t i e s , and c o n c l u d e d t h a t t h e s t i m u l u s was p r o b a b l y b e c a u s e I A R C r e s e a r c h made n a t i o n a l r e s e a r c h more p r o d u c t i v e . T h e n e g a t i v e I A R C - n a t i o n a l r e s e a r c h i n t e r a c t i o n terms f o r some c o m m o d i t i e s i n t h i s s t u d y r a i s e some f u r t h e r q u e s t i o n s on t h e issue. I t should be n o t e d , however, t h a t t h e n e g a t i v e i n t e r a c t i o n term i s e s t i m a t e d a t t h e m a r g i n a n d may n o t h o l d f o r t h e a v e r a g e r e l a t i o n s h i p b e t w e e n I A R C and n a t i o n a l s p e n d i n g . F u r t h e r , i t may be noted t h a t I A R C impact can s t i m u l a t e n a t i o n a l r e s e a r c h p r o d u c t i v i t y b y making l o n g e r - t e r m c o n t r i b u t i o n s t h a t a r e n o t n e c e s s a r i l y p i c k e d u p i n t h e s e d a t a . The I A R C s d o p r o d u c e t e c h n o l o g y t h a t is a c l o s e s u b s t i t u t e f o r some o f t h e t e c h n o l o g y I 57 p r o d u c e d i n n a t i o n a l p r o g r a m s . They a l s o p r o d u c e t e c h n o l o g y a n d pre-technology s c i e n c e t h a t complements and t h u s s t i m u l a t e s n a t i o n a l p r o g r a m work. The s t r o n g e s t I A R C s t i m u l a t i o n i m p a c t s o c c u r i n wheat, p o t a t o e s , m i l l e t s a n d g r o u n d n u t s . T h e s e commodities a l s o h a v e t h e weakest n e g a t i v e I A R C - n a t i o n a l r e s e a r c h i n t e r a c t i o n terms. The p o l i c y q u e s t i o n s t o w h i c h t h e s e d a t a s p e a k a r e w h e t h e r t o expand t h e I A R C s y s t e m , whether t o c o n t i n u e e x p a n s i o n and development of n a t i o n a l research s y s t e m s and whether t o c o n t i n u e d e v e l o p m e n t o f n a t i o n a l e x t e n s i o n programs. The m a i n t e n a n c e a n d e x p a n s i o n o f t h e I A R C s y s t e m i t s e l f i s d e t e r m i n e d b y i n t e r n a t i o n a l e n t r e p r e n e u r s a n d by d o n o r c o u n t r y a t t i t u d e s . T h i s i s i n c o n t r a s t t o n a t i o n a l s p e n d i n g o n research and e x t e n s i o n which is s u b j e c t t o n a t i o n a l economic and p o l i t i c a l forces. T h e s i g n a l s from t h i s s t u d y a r e q u i t e c l e a r a n d q u i t e s t r o n g . I n v e s t m e n t i n I A R C s b e y o n d t h e 1976-80 l e v e l i s l i k e l y t o be h i g h l y p r o d u c t i v e . 1 7 A d o n o r a g e n c y i n t e r e s t e d i n g e t t i n g t h e maximum i n c r e m e n t of food s u p p l y i n t h e d e v e l o p i n g w o r l d from a g i v e n a i d g r a n t w i l l o b t a i n i t by i n v e s t i n g more i n an I A R C . T h i s s t u d y shows t h a t I A R C i m p a c t s o n c r o p p r o d u c t i v i t y a r e p r o b a b l y h i g h e r t h a n a r e n a t i o n a l r e s e a r c h program i m p a c t s . F u r t h e r m o r e , i n v e s t m e n t i n I A R C s s t i m u l a t e s more n a t i o n a l s y s t e m i n v e s t m e n t t h a n w i l l a c o m p a r a b l e a m o u n t of d i r e c t a i d . T h e s e e s t i m a t e s o f h i g h p r o d u c t i v i t y i m p a c t d o n o t mean t h a t a l l I A R C s a r e o p t i m a l l y o r g a n i z e d . What t h e y d o t e l l u s i s t h a t t h e I A R C c o n c e p t i s a good one. The I A R C s have f i l l e d a vacuum, so t o s p e a k , a n d i n t h e i r e a r l y y e a r s most h a v e d o n e so p r o d u c t i v e l y . The vacuum was t h e absence of s t r o n g s c i e n c e - b a s e d n a t i o n a l r e s e a r c h p r o g r a m s . I t i s now c l e a r t h a t n a t i o n a l p r o g r a m s h a v e made g r e a t p r o g r e s s , p a r t of i t d u e t o I A R C s . B u t a good d e a l more i n v e s t m e n t a n d i n s t i t u t i o n a l d e v e l o p m e n t i s r e q u i r e d before these s y s t e m s w i l l e f f e c t i v e l y s u b s t i t u t e f o r t h e IARCs. 58 T h e s i g n a l s from t h i s s t u d y r e g a r d i n g n a t i o n a l r e s e a r c h s y s t e m i n v e s t m e n t a r e a l s o q u i t e c l e a r . I n s p i t e of v a r i a t i o n i n o r g a n i z a t i o n , s k i l l l e v e l s a n d o t h e r c h a r a c t e r i s t i c s , most n a t i o n a l system programs a r e productive. Returns t o investment a r e h i g h . Most e s t i m a t e d e l a s t i c i t i e s a r e s u f f i c i e n t l y h i g h t h a t they imply high r e t u r n s t o investment even i f t h e y are overe s t i m a t e d by a f a c t o r o f 2 o r 3 . A b l a n k e t r e c o m m e n d a t i o n t h a t a l l n a t i o n a l systems s h o u l d b e e x p a n d e d w i t h o u t r e g a r d t o t h e i r e x i s t i n g o r g a n i z a t i o n a n d s t r u c t u r e i s n o t j u s t i f i e d by t h e s e d a t a . However, a n e x p a n s i o n o f w e l l - o r g a n i z e d s y s t e m s i s c a l l e d f o r a n d t h e d a t a c l e a r l y show t h e p o t e n t i a l f o r h i g h p a y o f f national system investments i n a l l countries i n t h e developing world. Finally, the s i g n a l s regarding extension investment, while g e n e r a l l y p o s i t i v e , d o c a l l f o r c a u t i o n . W h i l e i t was a s s u m e d t h a t e x t e n s i o n does n o t p r o d u c e a l o n g - t e r m income stream, it is of c o u r s e , p o s s i b l e t h a t some p e r m a n e n t g a i n s a r e d u e t o e x t e n s i o n . T h i s p o s s i b i l i t y was n o t i n v e s t i g a t e d i n t h i s s t u d y . T h e r e is a minimum p r o d u c t i v i t y i m p a c t b e l o w w h i c h l a r g e investments i n extension cannot j u s t i f y extension spending t o produce v a l u e r a t i o s o f m u c h m o r e t h a n 1 p e r c e n t o f t h e v a l u e of a g r i c u l t u r a l product. P e r h a p s t h e more s e r i o u s i s s u e r e g a r d i n g e x t e n s i o n , h o w e v e r , i s t h e l a c k of e v i d e n c e t h a t e x t e n s i o n c o m p l e m e n t s r e s e a r c h . The s t r o n g n e g a t i v e i n t e r a c t i o n terms b e t w e e n r e s e a r c h a n d e x t e n s i o n s u g g e s t t h a t e x t e n s i o n p r o d u c t i v i t y i s b a s e d , n o t so much o n e x t e n d i n g r e s e a r c h r e s u l t s b u t on more g e n e r a l p r o d u c t i v i t y i m p r o v i n g e f f e c t s t h r o u g h i m p r o v i n g farm m a n a g e m e n t . There i s n o t h i n g w r o n g w i t h t h i s , b u t t h i s f i n d i n g s u g g e s t s t h a t more systematic s t u d y of t h e r e s e a r c h - e x t e n s i o n l i n k is called for. 59 Notes 1 J u d d , Boyce and Evenson, 1 9 8 3 p r o v i d e d e t a i l s . Appendix T a b l e s 1 and 2 t o t h i s p a p e r s u m m a r i z e c h a n g e s i n n a t i o n a l s y s t e m development. T h e d e f i n i t i o n o f c o u n t r y g r o u p s i s t h a t u s e d b y T h e W o r l d Bank i n i t s World Development R e p o r t 1984. See Table 7 f o r a l i s t of t h e c o u n t r i e s ; f o r t h e a n a l y s i s , Taiwan i s e x c l u d e d . Diversity i s measured a t t h e c o u n t r y l e v e l . It is d e f i n e d a s n DIVER = i=l sa where s i i s t h e s h a r e i n t o t a l a g r i c u l t u r a l p r o d u c t o f t h e i t h crop geo-climate combination. Many s t u d i e s show t h a t w h i l e c o n s u m e r s a r e t h e m a j o r g a i n e r s f r o m a g r i c u l t u r a l r e s e a r c h , t h e y a r e n o t s t r o n g s u p p o r t e r s of r e s e a r c h ( S e e B i n s w a n g e r , i n p r e s s , and Rose-Ackerman and Evenson, 1985). The v a r i a b l e BASIC d o e s n o t n e c e s s a r i l y m e a s u r e t t b a s i c t t research. Non-commodity o r i e n t e d r e s e a r c h c a n i n c l u d e f a r m i n g systems and e c o n o m i c r e s e a r c h . The CINTSP v a r i a b l e i s a n a t u r a l l y e x o g e n o u s v a r i a b l e s i n c e I A R C s p e n d i n g i s u n d e r t a k e n i n a s p e c i f i c l o c a t i o n and t h u s cannot respond t o c o u n t r y s p e c i f i c c o n d i t i o n s . I t can, o f c o u r s e , r e s p o n d t o commodity c o n d i t i o n s . Note t h a t t h i s i s n o t t h e a r e a of t h e c r o p on w h i c h t h e r e s e a r c h o b s e r v a t i o n i s made, b u t t h e a r e a o f a l l c r o p s . Note t h a t d ( P Q ) = d P ( 0 ) + dQ(P) l o T h e W o r l d Bank i s a r e l a t i v e l a t e - c o m e r t o t h e r e s e a r c h a n d It provided v e r y l i t t l e support p r i o r extension support f i e l d . t o 1974. I t s l e n d i n g s i n c e t h e n f o r r e s e a r c h and e x t e n s i o n h a s been: Research Ex tens i o n 8 314.4 m i l l i o n $227.5 m i l l i o n 1974-76 $271.9 m i l l i o n $1,033.0 m i l l i o n 1977-80 $ 740.5 m i l l i o n $890.0 m i l l i o n 1981-84 60 As c a n b e s e e n , t h e B a n k b e c a m e a m a j o r f a c t o r i n e x t e n s i o n s u p p o r t a f t e r 1 9 7 7 a n d a major f a c t o r i n research a f t e r 1980. The w e i g h t s i n ( 3 ) were " e s t i m a t e d " b y c o m p a r i n g t h e r e s i d u a l s q u a r e d e r r o r of t h e e q u a t i o n w i t h a n a l t e r n a t i v e t o ( 3) where t h e w e i g h t s rose t o o n e a t t g i n s t e a d of t5. Specification (3) was s l i g h t l y s u p e r i o r . l 2 The e l a s t i c i t y f o r s i m i l a r r e g i o n s i s t h e sum o f t h e t w o elasticities. '' l3 This is a c t u a l l y an underestimate o f t h e e l a s t i c i t y s i n c e t h e c o e f f i c i e n t e s t i m a t e s may a p p l y t o a l l d e v e l o p i n g c o u n t r i e s , n o t j u s t t o t h e 2 4 c o u n t r i e s i n t h e sample. However, e x c l u d i n g t h e P e o p l e s R e p u b l i c of C h i n a , t h e 2 4 c o u n t r i e s i n t h e sample a c c o u n t f o r more t h a n 85 p e r c e n t of c r o p p r o d u c t i o n i n t h e d e v e l o p i n g world. l 4 Note t h a t t h i s p r e s u m e s t h a t s p e n d i n g o c c u r s a t t h e b e g i n n i n g of y e a r t a n d p r o d u c t i v i t y d o e s n ' t a p p e a r u n t i l t h e e n d o f t h e y e a r . T h u s o n e f u l l y e a r is a d d e d t o t h e i m p l i c i t t i m e l a g s b u i l t i n t o t h e s p e c i f i c a t i o n . A 6-month l a g c o u l d h a v e b e e n used. T h i s c a l c u l a t i o n is t h u s c o n s e r v a t i v e . l 5 No a t t e m p t t o t e s t w h e t h e r t h e i m p a c t l a s t s beyond t h r e e p e r i o d s was made. However, had a d i f f e r e n t t i m e c o n f i g u r a t i o n been b u i l t i n t o t h e e x t e n s i o n s p e c i f i c a t i o n , its c o e f f i c i e n t and i t s e l a s t i c i t y w o u l d h a v e c h a n g e d . The r a t e of r e t u r n w o u l d p r o b a b l y n o t h a v e c h a n g e d v e r y much. ' 6 C a u t i o n i n i n t e r p r e t i n g e x t e n s i o n r e s u l t s from i n t e r n a t i o n a l d a t a i s w a r r a n t e d . Even if t h e s e e s t i m a t e s a r e u n b i a s e d , t h e y r e p r e s e n t a n a v e r a g e i m p a c t from p r o g r a m s v a r y i n g g r e a t l y i n q u a l i t y . Well-managed e x t e n s i o n p r o g r a m s w i t h s k i l l e d e x t e n s i o n workers w i l l h a v e a n i m p a c t h i g h e r t h a n t h i s a v e r a g e e s t i m a t e indicates. l 7 T h i s i s t h e case e v e n t h o u g h t h e I A R C s a r e r e l a t i v e l y h i g h cost i n s t i t u t i o n s . E x p e n d i t u r e s per s c i e n t i s t - y e a r a r e 2 t o 3 times t h o s e of n a t i o n a l s y s t e m s b e c a u s e of i n t e r n a t i o n a l s a l a r y l e v e l s a n d more e l a b o r a t e t e c h n i c a l s u p p o r t (See J u d d , Boyce a n d E v e n s o n , 1983). Appendix Table 1 : WESTERN EUROPE A g r i c u l t u r a l Research Expenditures and Worker Years*by Region (A Constructed T i m e Series, 1959-1980) Worker Years (Number) 1977 28,308 14,935 1980 1959 1962 1965 - 1968 - 1971 - 1974 - 1977 - 1980 32,267 17,803 1.422 44.824 37,511 40,205 170 136 22 130 260 100 200 152 20 250 280 120 1.300 2,322 90 550 720 1.700 720 210 3.990 212 900 300 550 1,962 8.274 300 165 19 310 300 170 1,850 3,114 100 650 850 2,100 820 250 4,770 280 1,091 350 580 2,301 10,185 500 180 19 350 308 205 2,578 4,140 105 650 1.086 2,500 900 285 5,526 280 1,025 400 615 2,320 11,986 530 215 27 422 393 250 2,840 4.677 110 650 1,130 2,750 981 295 5,916 325 1,099 450 640 2.514 13.107 560 242 35 490 480 300 3,310 5.417 110 800 1,240 3,000 1,100 325 6,575 390 1,200 500 670 2,760 14.752 638 326 44 486 577 359 5,551 7,981 134 838 1,868 3,177 1,538 373 7.928 492 1,218 372 1,004 3,086 -1L995 727 389 47 300 674 422 5.468 8,027 164 978 2,191 3,298 1.724 472 8,827 528 636 378 1,144 2.686 19,,5* Expenditures (000 Constant 1980 US $) Country 1959 4,797 3,949 493 3.949 12,696 6,769 . 1962 9,310 5,360 559 11.284 11,989 14,104 20,527 123,134 3.949 14,194 49,369 141,056 56,422 8,180 273.082 7,927 28,211 7,053 9.310 52,501 448,717 1 9 6 9 15,504 6,976 960 16,612 17,262 20,763 78,902 156,980 5,814 14,866 96.897 193,797 76,688 10,796 398,859 9,413 33,222 8,305 13.841 64.781 620,621 1 9 6 8 26,741 8,089 754 19,047 19,829 26,091 106.973 207,523 8,349 18,552 203.511 234,819 70.445 23,482 559,157 8,871 46,965 11,740 31,308 98.884 865,564 1 9 7 1 24,889 8,664 1,064 24,654 22,776 29,350 141,3>0 252,747 10,331 19,488 187,840 234,000 79.832 35,220 567,511 9,392 76.310 18,784 46.960 151,446 971,704 ix 1974 24,835 11,080 1.298 26,171 26,744 28,655 152,827 271.610 8,979 29,228 201,541 229,240 106,980 48,714 624,682 9.362 84,054 19,103 53,490 166,009 1,062,301 Denmark Finland Iceland Ireland Norway Sweden 1,583 25,956 32.122 34,180 166,005 303,089 10,978 30,599 179,770 242,763 220,106 55,892 740.108 11,809 59.668 19,427 60,928 151,832 1,195.029 - U. I;. Austria 62,065 94.718 3.949 12,696 22,569 59,242 36.659 5,924 141,054 7,899 22.569 4,231 4,513 39.212 274,984 235,495 1,000 409,527 1,818 13.415 35,709 221,590 277,762 70,713 12,683 106.988 19,757 69,400 80 260 440 638 170 195 600 300 450 Northern Europe Belgium France Germany Setherlands Suit t e r l a n d C e n t r a l Europe Greece Italy Portugal Sgain 252,044 1,300 871,233 2,888 Southern Europe Regional T o t a l - 208.828 1.545 1,489,588 6,251. Appendix Table 1: LATIN AMERICA continued Expenditures (000 c o n s t a n t 1980 US$)L’ Csuacry Worker Years (Number) 1959 1962 32,442 2,963 564 1.411 37,380 669 22,569 13,428 1,411 519 2,104 111193 51,893 1103 930 1,186 1,025 103 1,411 205 5,924 803 410 205 820 16,144 1965 48,991 6,229 554 1,385 57,159 693 41.527 17,746 2,768 814 4.154 13,677 1968 41.968 6,915 7 30 2,087 51,700 653 60,008 25,464 4,226 1.198 8,479 19,829 1971 42,978 16,436 775 2,348 62.537 19741977 70,441 10,315 1,146 3,437 85.339 53,490 11,960 2,529 3.399 71,378 1980 59,750 11,319 5,357 3,821 80,247 1968 - - - 1959 1962 1965 320 32 5 7 420 58 10 35 670 113 15 35 833 1630 1971 880 171 26 75 1974 a80 1977 1980 28,211 ArgenKlU 1,693 Cnile 423 Paraguay 761 Crubuay Ieaperace S o u t h 31,088 &erica bo 1i v i a - ---364 20 200 200 12 6 32 100 523 29 400 338 20 10 65 176 892 1.152 162 20 60 890 1,065 192 171 177 31 48 63 100 180 222 1.203 1,289 1.527 - 507 11,284 brazil 14,104 Colombia 704 Ecuador 348 Luyana 1,073 Peru 61772 Venr zue la Tropical Sourh 34,792 herica Itarbados iosca Rica El Salvador Guacesala tlaiti iisnduras Jamaica Yexico Xicaragua Pausa Trinidad b Tobago uoninican Rep. Caribbean 6 Central herical’ kegional Tocal 427 6,459 11,374 587 70.440 114,620 130,735 174,012 30,806 31,329 29,668 32,231 6,100 8,901 8,132 5,260 2,678 1,380 1,851 1,601 8,163 11,740 12.895 6,871 17,845 15.283 34,509 34,885 60 40 50 86 86 125 800 1,350 1.650 2,000 3,121 2,935 809 300 550 870 824 881 94 34 64 200 183 208 29 15 23 36 27 41 180 131 155 220 295 290 184 155 226 354 329 360 2,347 3,048 3,766 4,865 4,840 7 55 60 43 18 60 32 520 22 25 22 22 8 61 83 47 20 67 55 540 29 44 23 23 10 13 23 60 75 71 85 78 78 58 71 123 24 33 37 72 66 60 88 85 40 711 1,074 1,079 34 44 57 49 29 51 29 29 39 40 40 40 81,379 119,857 138,058 185,306 217,975 269,443 244 1,108 1,108 1,218 122 1,660 244 6,922 1,385 487 244 975 19,332 295 1,043 1,174 1,474 147 1,827 295 8.871 1,827 589 295 1,179 23,390 1 9 4 . 9 4 7 3 8 . 3 0 9 449 2,747 1,409 2,247 225 1,878 1,132 14,558 1,878 899 449 1,798 36,493 593 2,374 1,815 2,963 296 1,719 1,810 22,924 1,719 1,185 593 2,370 49,644 514 1,935 2,507 4.083 356 831 1,639 20,393 1,711 1,515 832 3,486 652 2,168 2,391 5,332 452 1,047 935 70,929 2,211 2,482 709 2,514 570 1,038 1,504 3 40 50 19 8 35 15 190 8 11 10 10 1 172 7 75 1,186 862 86 1,129 172 5,079 451 345 172 690 13,676 79.556 4 48 50 22 9 43 17 220 10 13 11 11 564 5 59 48 27 11 51 20 280 17 16 14 14 (48,956 112.941 491 691 1,090 1,230 1,552 2,015 2,167 8.534 105A17 157.860 462.631, 9 1.425 61-21.2 L/ Includes adjustment f o r missing c o u n t r i e s based on estimates (1% of s u b t o t a l s ) : CATIE ( I I C A ) 4 19 Cuba 23 ~. 2/ Our method f o r converting c u r r e n c i e s t o c o n s t a n t U . S . d o l l a r s tends to y i e l d lower expenditure levels f o r the 1970’s and 1980 €nor c o u n t r i e s vnicn have experien,:ed high rates o f i n f l a t i o n (e.g., Mexico, B r a z i l , Argentina) than t h e e x p d i t u r e levels ren9rte.d bjr ochers ( s e e Oram and 3 i n d l i s h . 1981). Appendix Table 1: continued NORTH AMERICA AND OCEANIA Expenditures (000 Constant 1980 US$) Worker- Y 1 1971 1974 1977 3,000 590 3,608 1,450 3,200 700 3,919 1,520 2,425 707 3.132 1,820 8.303 10,123 1980 2s589 li3 Csu2rrv 1559 76,169 14,952 51.577 104,664 56G.224 608.889 703.ib6 1962 95.918 16,927 113.408 108,614 648.858 757,472 870.880 1 1965 156,421 27,131 186,553 129,013 808.409 937.423 1968 169.591 29,484 200,071 211,336 939,275 1.150.612 1.350.652 1 9 7 1 281,760 44,612 328,004 234,800 1,056,600 1,291,400 1974 267.447 68,773 337,901 229,240 1,050,683 1,279,923 1977 286,823 73,713 362,339 277,925 1.072.880 1,350,805 J-j'IQlr4 1980 306,199 78,68.3 386.806 241,246 1,094,338 1,335,584 1959 1962 1,500 250 1,759 950 5,740 6.690 1,700 250 1,960 1,050 6,150 7,200 1965 1,900 450 2,362 1,150 6,570 7,720 10,082 1968 2,130 475. 2,618 1,300 7,000 8.300 10,918 Auus:rhiia DCta:1iaca,h;h Seu Zthiand 11 3,302 1,836 8,469 10,305 Lnicci Scares , 7,40~--7,500 8.850 1 2 4 . 5 3 9,020 Ssrcc .Gerica Be&i:r.d I Tom1 j?n ~6 1.619.- 4 i ) & & & l J . 0 2 4 1,.722,3,90 8,439 -9z$iiexico Xicaragua Jmica C a r i b b e a2i P ksgional Total 36 35 394 2,538 507 72 8.414 61,451 200 16 126 779 l! I n c l u d e s a d j u s t m e n t f o r m i s s i n g c o u n t r i e s ( p l u s W) I n c l u d e s adjuscment f o r missing c o u n t r i e s based on estimates (% of subtotals): Barbados Cuba Guatemala Z/ Haiti Panama Trinidad 6 Tobago Other 2 25 10 19 9 5 2 72 Appendix Table 2: WESTERN EUROPE continued Worker Years (Number) Average 1974 1959 1962 1965 1968 197L 1974 1977 1980 - 1971 - - _ 1977-80 _ 742 708 790 945 947 21.132 19.103 22,340 949 951 954 670 750 18.784 24,835 26,720 750 861 825 743 685 634 42 41 43 42 42 939 956 1,192 44 47 51 504 13.384 14.137 17.309 436 465 551 578 345 385 540 640 12,679 10.125 15,047 666 678 650 645 640 815 989 740 800 844 852 15,262 13.182 16,584 760 815 817 705 100 112.704 93.603 114,886 ,588 1.693 ,650 1,700 ,301) P,419 2.554 Expenditures (000 Constant 1980 US$) Cauntry xnmark 1959 - - 1962 - - -1965 - - 1968 - 15.516 704 5,079 16.927 845 6.488 17,995 20.873 18.786 939 9.392 15,915 99.147 970 8,305 15,781 12,414 16,081 20,460 FinLand Iceland Ireland Norvay Sweden U.K. 11,848 12,977 13,823 14.952 53.600 13,041 14.351 67,707 80.288 650 280 jor thern Europe 112.903 135.977 157,640 179,403 194.804 175.943 213,078 4.793 11,284 14,104 16,612 18,260 10,784 1,242 23,132 49,369 1,552 1.827 2.010 2.066 17,192 22,619 1,911 2,773 70.874 139.796 39.352 7,640 27.800 9,336 726 345 5.130 700 398 4.400 270 5,273 5.474 700 340 680 284 5.200 5,801 5,921 6,228 620 275 699 342 6.530 6.575 777 409 6,790 4,874 582 4 0 luscria Belgium France k-Y 4 28.702 83,056 75.664 65,744 57,834 63.675 62,098 61,048 Netherlands 15,234 23,900 31,839 37,821 41,090 Switzerland 2.820 3,808 4.705 6.391 7.396 Central 103.082 146,417 201,714 202.254 196.128 Europe Greece 3,668 4,034 4.318 4,226 3.569 Italy 11,284 19.747 29.071 37.831 37,568 Por rugal 845 5,642 10,244 10,697 10,566 Spain 2.153 8.462 1 ' 3 . 8 4 1 18.263 19,958 Soil the r n Europe 17,950 37.885 57.474 71,018 71.661 Regional . Total $ 2 0 2 6 2 2,460 3,668 4.400 5,700 6.300 4.812 505 1,250 530 53,490 57,698 2.936 170 4,400 4.500 370 480 5,100 4.714 1,228 1,598 1,500 1,500 1.500 1,446 1,471 555 190,460 260.022 3,344 3.933 33,431 42.046 9,552 12.009 18.148 23.932 7,865 11,034 11,710 12,644 13.447 14.075 14,286 14.903 330 2.000 500 500 440 650 500 400 692 700 480 839 900 907 3.772 913 4,042 2,500 2,500 3,050 3,250 3.500 850 970 1,100 1,185 1,270 920 1,050 1,200 1,356 1.512 6.109 6.700 7,220 7.737 29.215 64,474 81,920 3,330 3,590 4,292 5.300 Appendix: Table 2: continued NORTH AMERICA AND OCEANIA Expenditures (000 Constant 1980 US$) 1959 1962 1965 1968 1971 1974 Country Australia New Zealand Worker Years (Number) Average 1977-80 1959 1962 1965 1968 197a 1974 1977-80 1,700 370 2,080 1,500 1,750 375 2,136 1,500 1,800 375 2,186 1,750 2,000 30,576 7,899 50,466 50,780 50,780 8,462 59,538 56,422 55,371 9,136 64,828 69.212 62,619 10,958 78,273 93,920 11,740 84,528 95,,517 113,478 16,239 19,296 2,250 450 2,713 2,100 2,300 450 2,864 2,200 2.400 300 2,714 2.200 9,653 11,853 14.567, 400 2,412 2,000 Oceania-11 Canada U.S. 73.946 106,188 112,314 132,774 85,965 102,140 282,112 310,323 332,223 391,365 469,600 477,583 567,388 10,000 10,000 10,200 10,400 10.600 10,800 332,892 366,746 401,435 469,638 554,128 563,548 669,528 11,500 11,500 11,950 12,400 12,700 13,000 U S 8 426.284 466.263 543.583 6 6 0 3 4 North America Rrgional T o t a l 11 T o t a l s a d j u s t e d for missing c o u n t r i e s based on estimates of 0.5% of s u b t o t a l s . 73 References Boyce, James K . , and Robert E. Evenson (19751, "National and I n t e r n a t i o n a l A g r i c u l t u r a l Research and Extension Programs," A g r i c u l t u r a l Development Council. Commonwealth A g r i c u l t u r a l Bureau, A b s t r a c t s - c o m p u t e r i z e d d a t a base. Evenson, Robert E. (19821, "Observations on B r a z i l i a n A g r i c u l t u r a l Research and P r o d u c t i v i t y , " Qg Jkonomia J u r a l , Vol. 20, No. 3, July/September. (19831, llEconomics o f A g r i c u l t u r a l Growth: The Case o f Northern I n d i a , " Jssuet-i U Third Yorld PevehxmznIir K. c. Nobe and R. K. Sampath (eds.), Westview P r e s s , Boulder. Evenson, R o b e r t E.? Waggoner, P. and R u t t a n , V. W. (19791, "Economic Benefits from Research: An Example from A g r i c u l t u r e , " Science, 205, September. Food and A g r i c u l t u r e O r g a n i z a t i o n o f t h e U.N.t F r o d u c t i o n , annual. Yearbook nf G r i l i c h e s , Z. (19581, "Research C o s t s and S o c i a l R e t u r n s : H y b r i d Corn and Related I n n o v a t i o n , " J o u r n a nf U t i c a l Economy, 66:419-31. J a m i s o n , D. T., and Lau, L. J. (19821, & m s E d u c a t i o n a n d b . r n Efficiencv , B a l t i m o r e , Johns Hopkins U n i v e r s i t y Press. J u d d , M, A n n , Boyce, J a m e s K., and E v e n s o n , R o b e r t E. (19831, D i s c u s s i o n Paper " I n v e s t i n g i n A g r i c u l t u r a l Supply," E.G.C. 442, Yale U n i v e r s i t y , Economic Growth Center. ' K i s l e v , Yoav, and Evenson, Robert E. (19751, "Investment i n A g r i c u l t u r a l Research and Extension, An I n t e r n a t i o n a l S u r v e y , " Economk Cultural A p r i l 23. Norton, G. R., and Davis, J e f f r e y S. (19811, " E v a l u a t i n g Returns t o Research," A m e r i c m JPtlrnal Qf &.ciculturiaL ECDnOQlfC1Sr Vol. 6 3 , No. 4 , November. Oram, Peter and B i n d l i s h , Vishva (19811, "Resource A l l o c a t i o n t o A g r i c u l t u r a l Research: T r e n d s i n t h e 1970s ( A Review o f T h i r d World Systems) ," Washington, D . C . , I n t e r n a t i o n a l Food P o l i c y Research I n s t i t u t e . Papadakis, J. (1965), k r i c u l t u r a a u m a t e g Aires. R u t t a n , Vernon W. Qf - w, World, Buenos Minneapolis, U n i v e r s i t y o f Minnesota Press. (19841, A n r i m t u r u Research I k ? l u Y , World Bank (19831, World D e v e l o p m e n t Report, N e w York, 2xford U n i v e r s i t y Press. Evenson The International Agricultural Research Centers I I cain @ I I i I