The Impact of Agricultural Biotechnology on Yield, Risks, and Biodiversity in Low-income Countries

This paper shows that the current generation of transgenic crop varities has significat potential to improve economic welfare in low-income countries. These varieties might increase crop yields in low-income countries in case when pesticides have not been used. They will reduce negative health effects of chemicals when they replace them. With low transaction costs, appropriate infrastruture, and access to intellectual property, multiple varieties of transgenics will be introduced. The gain from transgenics will be reduced, and crop biodiversity may be lost when only a small set of varieties is transgenetically modified. The adoption of transgenics will also be affected by risk and credit considerations.