Technology Adoption and Learning-by-Doing: The Case of Bt Cotton Adoption in China

Although the benefits of genetically modified (GM) crops have been well documented, how do farmers manage the risk of new technology in the early stages of technology adoption has received less attention. We compare the total factor productivity (TFP) of cotton to other major crops (wheat, rice, and...

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Autores principales:	Guang Tian, Xiaoxue Du, Fangbin Qiao, Andres Trujillo-Barrera
Formato:	article
Lenguaje:	EN
Publicado:	MDPI AG 2021
Materias:	genetically modified crops technical efficiency total factor productivity Bt cotton risk management Risk in industry. Risk management HD61 Finance HG1-9999
Acceso en línea:	https://doaj.org/article/e426ece0394c4d64bd2f00654a5a26d4
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spelling	oai:doaj.org-article:e426ece0394c4d64bd2f00654a5a26d42021-11-25T18:08:33ZTechnology Adoption and Learning-by-Doing: The Case of Bt Cotton Adoption in China10.3390/jrfm141105241911-80741911-8066https://doaj.org/article/e426ece0394c4d64bd2f00654a5a26d42021-11-01T00:00:00Zhttps://www.mdpi.com/1911-8074/14/11/524https://doaj.org/toc/1911-8066https://doaj.org/toc/1911-8074Although the benefits of genetically modified (GM) crops have been well documented, how do farmers manage the risk of new technology in the early stages of technology adoption has received less attention. We compare the total factor productivity (TFP) of cotton to other major crops (wheat, rice, and corn) in China between 1990 and 2015, showing that the TFP growth of cotton production is significantly different from all other crops. In particular, the TFP of cotton production increased rapidly in the early 1990s then declined slightly around 2000 and rose again. This pattern coincides with the adoption of Bt cotton process in China. To further investigate the decline of TFP in the early stages of Bt cotton adoption, using aggregate provincial-level data, we implement a TFP decomposition and show that the productivity of GM technology is higher, whereas the technical efficiency of GM technology is lower than that of traditional technologies. Especially, Bt cotton exhibited lower technical efficiency because farmers did not reduce the use of pesticide when they first started to adopt Bt cotton. In addition, we illustrate the occurrence of a learning process as GM technology diffuses throughout China: after farmers gain knowledge of Bt cotton, pesticide use declines and technical efficiency improves.Guang TianXiaoxue DuFangbin QiaoAndres Trujillo-BarreraMDPI AGarticlegenetically modified cropstechnical efficiencytotal factor productivityBt cottonrisk managementRisk in industry. Risk managementHD61FinanceHG1-9999ENJournal of Risk and Financial Management, Vol 14, Iss 524, p 524 (2021)
institution	DOAJ
collection	DOAJ
language	EN
topic	genetically modified crops technical efficiency total factor productivity Bt cotton risk management Risk in industry. Risk management HD61 Finance HG1-9999
spellingShingle	genetically modified crops technical efficiency total factor productivity Bt cotton risk management Risk in industry. Risk management HD61 Finance HG1-9999 Guang Tian Xiaoxue Du Fangbin Qiao Andres Trujillo-Barrera Technology Adoption and Learning-by-Doing: The Case of Bt Cotton Adoption in China
description	Although the benefits of genetically modified (GM) crops have been well documented, how do farmers manage the risk of new technology in the early stages of technology adoption has received less attention. We compare the total factor productivity (TFP) of cotton to other major crops (wheat, rice, and corn) in China between 1990 and 2015, showing that the TFP growth of cotton production is significantly different from all other crops. In particular, the TFP of cotton production increased rapidly in the early 1990s then declined slightly around 2000 and rose again. This pattern coincides with the adoption of Bt cotton process in China. To further investigate the decline of TFP in the early stages of Bt cotton adoption, using aggregate provincial-level data, we implement a TFP decomposition and show that the productivity of GM technology is higher, whereas the technical efficiency of GM technology is lower than that of traditional technologies. Especially, Bt cotton exhibited lower technical efficiency because farmers did not reduce the use of pesticide when they first started to adopt Bt cotton. In addition, we illustrate the occurrence of a learning process as GM technology diffuses throughout China: after farmers gain knowledge of Bt cotton, pesticide use declines and technical efficiency improves.
format	article
author	Guang Tian Xiaoxue Du Fangbin Qiao Andres Trujillo-Barrera
author_facet	Guang Tian Xiaoxue Du Fangbin Qiao Andres Trujillo-Barrera
author_sort	Guang Tian
title	Technology Adoption and Learning-by-Doing: The Case of Bt Cotton Adoption in China
title_short	Technology Adoption and Learning-by-Doing: The Case of Bt Cotton Adoption in China
title_full	Technology Adoption and Learning-by-Doing: The Case of Bt Cotton Adoption in China
title_fullStr	Technology Adoption and Learning-by-Doing: The Case of Bt Cotton Adoption in China
title_full_unstemmed	Technology Adoption and Learning-by-Doing: The Case of Bt Cotton Adoption in China
title_sort	technology adoption and learning-by-doing: the case of bt cotton adoption in china
publisher	MDPI AG
publishDate	2021
url	https://doaj.org/article/e426ece0394c4d64bd2f00654a5a26d4
work_keys_str_mv	AT guangtian technologyadoptionandlearningbydoingthecaseofbtcottonadoptioninchina AT xiaoxuedu technologyadoptionandlearningbydoingthecaseofbtcottonadoptioninchina AT fangbinqiao technologyadoptionandlearningbydoingthecaseofbtcottonadoptioninchina AT andrestrujillobarrera technologyadoptionandlearningbydoingthecaseofbtcottonadoptioninchina
_version_	1718411591474479104

Technology Adoption and Learning-by-Doing: The Case of Bt Cotton Adoption in China

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