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Studying Innovation in Agriculture – New Data and New Tools

Paper Session

Friday, Jan. 3, 2020 10:15 AM - 12:15 PM

Manchester Grand Hyatt San Diego, Mission Beach A
Hosted By: Agricultural and Applied Economics Association
  • Chair: GianCarlo Moschini, Iowa State University

Knowledge Spillovers in Agricultural Innovation: Evidence from Patents

Matthew Clancy
,
Iowa State University
Paul Heisey
,
USDA Economic Research Service
Yongjie Ji
,
Iowa State University
GianCarlo Moschini
,
Iowa State University

Abstract

Agricultural productivity has increased tremendously over the last century, largely due to waves of technological innovations credited to past investment in agricultural research and development (R&D) activities. This paper investigates the extent to which knowledge spillovers from outside agriculture may contribute to agricultural R&D. We develop metrics of US agricultural R&D output based on US patents granted over the period 1976-2016. To measure knowledge flows, we rely on three main proxies: patent citations to other patent, patent citations to the scientific literature, and novel items appearing in patents’ text. The originating domain of knowledge flows is alternatively characterized in terms of patent technology classes, assignee type, and subject areas of scientific citations. By tracking citations to other patents, to journal articles, and by performing a novel text analysis to identify and track new ideas, we present evidence that non-agricultural knowledge may be as important to agricultural R&D output as agricultural R&D.

How Do Patents Shape Global Value Chains? International and Domestic Patenting and Value-Added Trade

Nikolas Zolas
,
U.S. Census Bureau
Travis Lybbert
,
University of California-Davis

Abstract

Intellectual property plays an important role in the global economy through its impact on technology diffusion, knowledge transfer and competition. As production has become fragmented into coordinated processes that span the globe, the role of patents has evolved. Patents can transmit technical knowledge and facilitate upstream and downstream licensing arrangements, thereby increasing the flow of intermediate and final goods and catalyzing knowledge spillovers across sectors and regions. We exploit an algorithmic concordance that links patents to industry and product classifications to estimate how patents affect the organization and structure of Global Value Chains (GVCs). Using the World-Input Output Database as the basis for various GVC measures, we find that increased international patenting inflows are associated with greater value-added production, but that this positive effect is driven entirely by industries in high-income countries. We also find some evidence of heterogeneity in these effects by region and sector-specific R&D intensity. We explore this heterogeneity with a specific focus on dominant patterns in agriculture, food, and life science sectors.

Venture Capital, Startups, and R&D for Agriculture and Food

Felipe De Figueiredo Silva
,
University of California-Berkeley
Gregory Graff
,
Colorado State University

Abstract

Venture capital (VC) investments in privately held startup companies that are intensively engaged in agricultural research and development (R&D) has increased substantially in recent years, from just tens of millions annually in the early 2000s to reportedly more than 7 billion dollars in 2017. These investments are important for several reasons. First, the magnitudes of these VC investments are no longer negligible relative to levels of estimated private sector investments in agricultural R&D, yet they have not typically been accounted for in estimates of agricultural R&D spending. Second, these investments are supporting R&D being conducted by new entrants in a number of industries that have been highly concentrated and where incumbents may have been taking relatively incremental approaches to R&D strategy. Third, R&D by technology based startups represent an important channel for diffusion of results from public sector agricultural research, in both developed and developing countries. This paper describes recent trends in agricultural technology startup companies and the VC investments made in them. This paper also seeks to answer the question of what might account for the upturn in VC investment in agricultural technology startups in recent years. To do so, we construct a dataset of more than 4,500 startups, located in 125 countries. For a subset of these, we have complete financial information on over 10,000 financial transactions from 1981 to 2018, allowing us to study the startup investment life cycles and exit outcomes over time. Results indicate that previous successful exits from agricultural technology startups – in the forms of Initial Public Offering (IPO) and Merger & Acquisition (M&A) – lead to higher investments today. Payoffs from prior investments seem to signal the viability of investments in the agricultural sector. But among exit events, prior IPOs appear to have a stronger effect on new investments than prior M&As.
Discussant(s)
Brian Wright
,
University of California-Berkeley
JEL Classifications
  • O3 - Innovation; Research and Development; Technological Change; Intellectual Property Rights