Returns to Disease Resistance Research When Pest Management Is an Option

Abstract

Resistant cultivars offer a pathway to sustainable intensification by maintaining yields and reducing inputs in the face of disease pressure. Past studies of economic returns to crop breeding research for disease resistance measured farm-level benefits, by comparing yields for improved resistant varieties (RVs) to susceptible traditional varieties. This approach will poorly approximate actual research benefits if non-RV pest management options exist, because it does not account for farmer pest control behavior. We propose a unit cost model that controls for farm-level yields and pesticide inputs. The model estimates the difference in unit variable costs (UVC), with and without disease pressure for RV adopters and non-adopters, while holding pest control inputs, farm characteristics, and other factors fixed. We apply the model to data from 136 bean farmer households in northern Ecuador, where RV research is ongoing and fungicide use is widespread. We find no difference in UVC, with and without disease pressure for non-adopters. For adopters, UVC is 24% lower with disease pressure than without. This translates to an ex-post net present value (NPV) of USD 698,828 and an internal rate of return (IRR) of 17%, compared to an NPV of USD 887,391 and IRR of 29%, when accounting for yield differences only. The results oblige impact assessments to account for changes in yields and input costs when pest management is an option.

Return on investment of the International Potato Center–led seed system interventions in Malawi

“…However, this does not imply that consumers did not benefit; they benefited from improved tuber quality, continuous and increased supply, and stable prices (Maredia et al, 2000). The findings are consistent with Mooney et al (2022), who found that consumers did not realize benefits through price changes but the total benefits of bean-resistant varieties combined with pest management technologies in Northern Ecuador.…”

The socio-economic challenges of managing pathogen evolution in agriculture

“…Because plant genetic resistance is not the only option available to farmers for disease control, clear articulation of the costs and benefits of effective plant genetic resistance, relative to alternatives, is critical for placing value on resistance stewardship practices. For example, using an economic model which accounts for costs of pesticide inputs, Mooney et al [44] have shown that failure to account for input costs spent on alternative disease control options underestimates the benefits of genetic resistance.…”

“…In addition to direct effects on yield loss, effective plant genetic resistance can generate other direct and indirect economic benefits, although these are rarely recognized (figure 1). For example, beyond directly reducing yield losses, effective genetic resistance can increase food supply by lowering production costs [44,45]. Effective plant genetic resistance can also impact food supply by avoiding social concerns about reductions in food quality and safety resulting from increased reliance on pesticides [46][47][48].…”

“…For example, using an economic model which accounts for costs of pesticide inputs, Mooney et al . [ 44 ] have shown that failure to account for input costs spent on alternative disease control options underestimates the benefits of genetic resistance.

Figure 1 Direct and indirect economic benefits of implementing effective plant genetic resistance.

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“…pesticide application), at the farm level the key relative economic benefit of effective genetic resistance is that it reduces (fully or partially) the requirement for labour and capital inputs (costs of stewardship are discussed below). In other words, effective genetic resistance has resource-saving benefits that result in a reduction in the cost of production [ 44 , 45 ]. For example, disease control using pesticides incurs a range of costs for the farmer, including the purchase of pesticides, labour costs and additional production costs for purchasing and maintaining machinery (capital), which could be reallocated to other production activities ( figure 2 ).…”