State-Contingent Demand for Herbicide-Tolerance Seed Trait

Suppose a farmer had to apply a herbicide pre-emergence or not at all. The advent of a herbicide-tolerance trait innovation then provides the option to wait for more information before making a state-contingent post-emergence application. This option to wait can increase or decrease average herbicid...

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Bibliographic Details
Main Authors: David A. Hennessy, Alexander E. Saak
Format: Article
Language:English
Published: Western Agricultural Economics Association 2003-04-01
Series:Journal of Agricultural and Resource Economics
Subjects:
Online Access:https://ageconsearch.umn.edu/record/30723
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spelling doaj-c987d7e7065246428348448b7118ee2a2020-11-25T01:27:49ZengWestern Agricultural Economics AssociationJournal of Agricultural and Resource Economics1068-55022327-82852003-04-0128111410.22004/ag.econ.3072330723State-Contingent Demand for Herbicide-Tolerance Seed TraitDavid A. HennessyAlexander E. SaakSuppose a farmer had to apply a herbicide pre-emergence or not at all. The advent of a herbicide-tolerance trait innovation then provides the option to wait for more information before making a state-contingent post-emergence application. This option to wait can increase or decrease average herbicide use. for heterogeneous acre types, trait royalties increase with the level of uncertainty about the extent of weed damage. Royalties are largest when acre infestation susceptibility types are bunched around the type indifferent to applying the herbicide in the absence of the trait. The trait complements (substitutes for) information technologies that facilitate informed post-emergence (pre-emergence) decisions.https://ageconsearch.umn.edu/record/30723geneticsinformation inputspatent valuepost-emergencereal option
collection DOAJ
language English
format Article
sources DOAJ
author David A. Hennessy
Alexander E. Saak
spellingShingle David A. Hennessy
Alexander E. Saak
State-Contingent Demand for Herbicide-Tolerance Seed Trait
Journal of Agricultural and Resource Economics
genetics
information inputs
patent value
post-emergence
real option
author_facet David A. Hennessy
Alexander E. Saak
author_sort David A. Hennessy
title State-Contingent Demand for Herbicide-Tolerance Seed Trait
title_short State-Contingent Demand for Herbicide-Tolerance Seed Trait
title_full State-Contingent Demand for Herbicide-Tolerance Seed Trait
title_fullStr State-Contingent Demand for Herbicide-Tolerance Seed Trait
title_full_unstemmed State-Contingent Demand for Herbicide-Tolerance Seed Trait
title_sort state-contingent demand for herbicide-tolerance seed trait
publisher Western Agricultural Economics Association
series Journal of Agricultural and Resource Economics
issn 1068-5502
2327-8285
publishDate 2003-04-01
description Suppose a farmer had to apply a herbicide pre-emergence or not at all. The advent of a herbicide-tolerance trait innovation then provides the option to wait for more information before making a state-contingent post-emergence application. This option to wait can increase or decrease average herbicide use. for heterogeneous acre types, trait royalties increase with the level of uncertainty about the extent of weed damage. Royalties are largest when acre infestation susceptibility types are bunched around the type indifferent to applying the herbicide in the absence of the trait. The trait complements (substitutes for) information technologies that facilitate informed post-emergence (pre-emergence) decisions.
topic genetics
information inputs
patent value
post-emergence
real option
url https://ageconsearch.umn.edu/record/30723
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