Closed-market models embodying alternative specifications of supply, demand and substitutability conditions are developed to measure the economic benefits from a research-caused improvement in quality. The models are applied to the estimation of the economic benefits from reducing backfat depth in Australian pork. A major finding is that the Australian pig industry has the potential to derive a gross research benefit of about $7 million per annum from a 10% reduction in backfat thickness in pigs. Under each of the chosen specifications, the larger share of this gain accrues to pig producers. There could be additional social gains as a result of health benefits not incorporated in consumers' valuations.
|Number of pages||11|
|Journal||Journal of Agricultural Economics|
|Publication status||Published - 1 Jan 1991|
VOON, J. P. T., & EDWARDS, G. W. (1991). Research payoffs from quality improvement : the case of backfat depth in pigs. Journal of Agricultural Economics, 42(1), 66-76. https://doi.org/10.1111/j.1477-9552.1991.tb00333.x