Intellectual Property Rights and the welfare effects on Agriculture Research: A Review

The profound changes that have affected agriculture in modern times are perhaps best illustrated by the evolution of production techniques due to mechanization, new chemical inputs such as herbicides, pesticides and fertilizers, genetic selection of crops and animals, new crop varieties, and countless other technical and organizational improvements. These innovations have allowed a generalized increase in physical output while, at the same time, agriculture has suffered a massive exodus of labour forces towards the non-farm sectors. Indeed, a stylized fact of developed countries’ post-war growth is that productivity in agriculture has grown faster than in other sectors. This remarkable record naturally begs the question of what is at its root, and a view that commands considerable consensus is that agricultural productivity growth is due to (past) investments in scientific research and development (R&D). It is argued that the conventional assumption of competitive pricing cannot hold when new technologies are produced by private firms because such innovations are typically protected by intellectual property rights (such as patents) that confer (limited) monopoly rights to discoverers. The review summarized the intricate relationship between IPR and research and development and tools for effective IPR management and policy considerations. Overall, the IPR in agri-food sector literature offers diverse, sometimes conflicting views with limited empirical research. As a result, further comprehensive empirical investigations are required to understand the subject and better inform policymakers.