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Report2010Open access

Research on agricultural research : rates of return to agricultural research in Sweden

Renborg, Ulf


A Cobb-Douglas type production function is estimated for the Swedish agricultural sector over the period 1944/45 - 1986/87. Total production of the sector is the dependent variable. Public research and advisory services are introduced as independent variables together with labour, land, variable capital and inputs bought from other sectors and a yield variable. Research is introduced with lags from 6 to 24 years from research inputs to effects on the total sector production. Research lags of 14-18 years give best estimation quality. Elasticities of total production per farm related to public research are estimated to lie between 0,06 and 0, 10 for the total period. Production elasticities related to advisory services give too uncertain results to be closer analyzed. Marginal value products, MVP, related to research are calculated to 7-12 as an average for the period. IRR, Internal rates of return to public research reach 13 to 17 per cent per year above price level change over the lag period of 16-18 years. These MVP:s and internal rates of return are calculated for total production at national prices, "as the farmers see them". Approximate estimates of these values for production at world market prices give MVP:s of 4-8 and IRR of 10 to 14 per cent over price level change.


agricultural research; MVP; IRR; productivity; impact of research; Sweden

Published in

Report / Swedish University of Agricultural Sciences (SLU), Department of Economics
2010, number: 166
Publisher: Department of Economics, Swedish University of Agricultural Sciences

    UKÄ Subject classification

    Other Agricultural Sciences not elsewhere specified

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