“Socio-Economic Impact Assessments and Biotechnology: The

Experience to Date”

José Falck Zepeda

Research Fellow
Leader Policy Team Program for Biosafety Systems (PBS)
IFPRI

From left to rigth: a) Damage by Asia corn borer and b) Bt maize plot in Barangay Conel, Mindanao, The Philippines, c) Transgenic Garden, UP-
LB Los Banos, Luzon, Philippines
Current status 2009
 90 million hectares
 Six countries cultivated 96% of this area
 USA 50.0
 Argentina17.1

 Canada 5.8
 China 3.3
 Paraguay 1.8
 India 1.3
 Mainly four crops and two technologies
 Private sector dominates product development
 Public sector in developing countries developed multiple
technologies, very few have reached farmers
In developing countries
Argentina, Brazil, China and India represent close to
90% adoption in developing countries
Only two countries planting locally-developed public
sector technologies: India and China
Three countries in Africa planting GM crops: South
Africa, Burkina Faso and Egypt
Confined Field Trials in Kenya, Uganda, Nigeria,
Philippines, India, China, Brazil, Guatemala, Honduras,
Mexico, Argentina, others...
What do we know from the economic impact assessment
literature to date? –
A review of 187 peer
reviewed studies
Different impact domains
Farmers, household and
community
Industry and markets
Consumers

Trade

Citation: Smale, Melinda; Zambrano, Patricia; Gruère, Guillaume; Falck-Zepeda, José; Matuschke, Ira; Horna, Daniela; Nagarajan, Latha;
Yerramareddy, Indira; Jones, Hannah. 2009. Measuring the economic impacts of transgenic crops in developing agriculture during the first
decade: Approaches, findings, and future directions. (Food policy review 10) Washington, D.C.: International Food Policy Research Institute
(IFPRI) 107 pages
On average, profitable—but averages mask variability by
agro-climate, host cultivar, trait, farmer
Some Ex ante results from studies conducted by IFPRI
and country partners
Country Crop/Trait Representative findings
Uganda Fungal resistant • If approval delayed, forego potential annual (social) benefits of
bananas +/- US$200 million

West Africa Bt cotton • Countries are worse off by not adopting

• Smaller net benefits and returns than other studies
• Negotiating downward the technology fee is key
Uganda Bt cotton • Positive yield impacts on net benefits
• Smaller IRR probably explained due to low initial yields – need
to improve overall cotton productivity
• Probability of a negative return can be as high as 38% with a
full technology fee charge – negotiate the fee…
 On average, profitable—but averages mask
variability by agro-climate, host cultivar, trait,
farmer (2)
Some Ex post studies conducted by IFPRI and country
partners
Country Crop/Trait Representative findings
Honduras Bt maize • Excellent control of target insects
• Yield advantage 893-1136 Kg/ha yield (24-33% higher yield Bt)
• Bt maize preferred even by risk averse producers based on yield only
• 100% higher seed cost than conventional hybrid

Philippines Bt maize • Adopters tend to be larger, use hired labor and are more educated.
• Growing Bt maize significantly increases profits and yields
• Significant insecticide use reductions

Colombia Bt cotton • Evidence of yield enhancement rather than pesticide reductions

• Bt farmers benefited from the technology for one of the two regions in the
study, where the target pest is economically important
• Sources of bias important: farmers who adopt are those that are better off
• Institutional context crucial
 Bt cotton production parameters
Parameter India China South Argentina,
Africa Mexico

Yield Advantage 40 11 41 9
(n)

Min (%) -0.17 -0.06 -0.36 -0.03

Median (%) 0.42 0.06 0.56 0.32
Max (%) 0.92 0.55 1.29 0.65
Reduction in 29 7 29 8
insecticide
Applications (n)
Min (%) -0.83 -0.82 -0.95 -0.81
Median (%) -0.3 -0.66 -0.53 -0.51
Max (%) 0.83 -0.56 0.68 -0.02
Profit (n) 16
Min (%) -0.65
Median (%) 0.47
Max (%) 1.36
Estimates potential GM crop adoption

Source: Qaim 2009

Too few traits, too few cases/authors—
generalizations should not be drawn yet...need
more time to describe adoption
Focus on existing crops/traits
Insect protected/ herbicide tolerance
Four crops: corn, cotton, canola, soybeans
Concern over potential estimates bias
Next decade: Cross cutting issues for further
study and the need for improved methods
Issues
Gender, health and generational
Institutional
Information and knowledge flows
Impacts on poverty and inequality
Externalities
Need for improved methods
Household modeling
Risk and uncertainty
Address selection bias and endogeneity