No abstract

Although wheat is the largest field crop in Canada, the intellectual property rights for the self‐pollinated, nongenetically modified crop have been too weak to allow significant royalty flow to plant breeders. The sector heavily relies on resource‐constrained public breeding programs for new variety development. This long‐standing situation could change with the 2015 Agricultural Growth Act, which strengthens Canadian plant breeders’ rights to be consistent with the UPOV 91 convention. We explore the potential implications for Canada by examining the experience with UPOV 91 implementation in the United Kingdom, France, and Australia. Using the royalty structures in these countries as potential pathways for Canada, an ex ante benefit–cost framework is used to illustrate the choice of pathway is important. Over a 40‐year period, the Australian, French, and U.K. implementation pathways generate 4.8, 4.0, and 1.5 $CDN billion in net benefit (respectively) over the status quo. Over shorter time horizons of 20 and 30 years, France is quicker to establish uniform endpoint royalties that provide the highest net benefits. Proactive industry engagement to develop a more robust royalty collection system is required to realize these potential benefits.

With increased private investment in crop breeding research in the developed world, intellectual property rights have gained importance in seed sector. Trade Related Aspects of Intellectual Property Rights (TRIPS)-plus provisions included in recent free trade agreements between the developed and developing countries show a tendency of the developed world to impose their high standards for protection of plant intellectual property on the developing world. While stronger intellectual property rights can increase international exchange in seed, market power effect can lead to a reduction in exports of seed to foreign markets. This article estimates the impact of intellectual property rights on U.S. seed exports. The estimation is performed at a crop level using Heckman selection model. The results reveal that the impact of intellectual property rights varies across different types of crops-open-pollinated, genetically modified, and hybrid crops. While TRIPS provisions are important to facilitate transfer of genetically modified crops, they play a minor role for open-pollinated and hybrid crops. The results also show that plant breeders' rights envisioned by the UPOV system can be important to promote seed exchange when proper mechanisms are put in place to enforce these rights.JEL classification: F13, O34, Q17

Market liberalization has a profound impact on the structure of economies as well as changes the roles of the public and private sectors and affects innovative capacity of countries. This paper explores the Brazilian experience with wheat market liberalization and the impact on the seed sector. The analysis presented in this paper is based on interviews with 12 experts intimately involved in wheat research and breeding in Brazil. The analysis reveals liberalization boosted private investment in wheat R&D, which translated into increased research output. However, Brazil faced many challenges in establishing wheat innovation system and important lessons can be drawn from its experience.

This paper examines the incentives for knowledge sharing in an industry where a public institution and a private firm develop new differentiated crop varieties and sell them to heterogeneous farmers. The decision of the public institution to either share their knowledge, or protect and cross‐license their IP with the rival firm, is a strategic choice. While the profit‐maximizing private research firms have an incentive to protect and secure their intellectual property (IP), under some conditions they choose to cross‐license their technology rather than forgo access to the public IP. The budget constrained public firm, with an objective of maximizing farmers’ welfare, can have an incentive to share its IP but under certain conditions has an incentive to incur transaction costs to protect and cross‐license its technology to obtain access to the private technology. The theoretical model shows that public incentives to protect IP are likely to be stronger in a research industry with significant corporate presence. A survey of Canadian wheat and canola breeders reveals that public breeders are far more secretive in the canola sector than in the wheat sector, a dichotomy that is consistent with the theoretical results. Le présent article examine les avantages du partage de connaissances dans un secteur d’activité où une institution publique et une firme privée mettent au point de nouvelles variétés végétales différenciées et les vendent à des agriculteurs hétérogènes. La décision de l’institution publique de partager ses connaissances ou de protéger sa propriété intellectuelle (PI) et de procéder à la concession de licences réciproques avec la firme rivale constitue un choix stratégique. Bien que les firmes de recherche privées axées sur la maximisation des bénéfices aient intérêt à protéger leur PI, dans certaines conditions, elles choisissent de procéder à la concession de licences réciproques plutôt que de renoncer à l’accès de la PI du secteur public. L’institution publique à budget restreint, qui vise entre autres à maximiser le bien‐être des agriculteurs, peut tirer profit du partage de sa PI mais, dans certaines conditions, elle a intérêt à assumer les coûts de transaction pour protéger sa technologie et procéder à une concession de licences réciproques afin d’obtenir l’accès à la technologie du secteur privé. Le modèle théorique montre que les avantages publics liés à la protection de la PI risquent d’être plus importants dans un secteur de la recherche où la présence des entreprises est forte. Un sondage mené auprès de sélectionneurs de blé et de canola canadiens révèle que, dans le secteur public, les sélectionneurs de canola sont beaucoup plus enclins à conserver le secret que les sélectionneurs de blé, une dichotomie qui concorde avec les résultats théoriques.