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Refining Opportunity Cost Estimates of Not Adopting GM Cotton: An Application in Seven Sub‐Saharan African Countries
Author(s) -
Bouët Antoine,
Gruère Guillaume P.
Publication year - 2011
Publication title -
applied economic perspectives and policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.4
H-Index - 49
eISSN - 2040-5804
pISSN - 2040-5790
DOI - 10.1093/aepp/ppr010
Subject(s) - computable general equilibrium , tanzania , bt cotton , economics , productivity , agricultural economics , opportunity cost , developing country , liberalization , microbiology and biotechnology , economic growth , biology , socioeconomics , microeconomics , market economy
A computable general equilibrium model is applied to evaluate the opportunity costs of not adopting Bt cotton, a genetically‐modified (GM) insect resistant cotton, in Benin, Burkina‐Faso, Mali, Senegal, Togo, Tanzania, and Uganda when it is adopted in other countries. Our model uniquely employs country‐specific partial adoption rates and factor‐biased productivity shocks in the cotton and oilseed sectors of all adopting regions. Assuming a 50% adoption rate, the opportunity cost of not adopting Bt cotton in the seven surveyed countries amounts to $41 million per year, which is a significant but lower cost than that suggested by the results of previous studies. Trade liberalization only marginally increases this estimate.