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Technology and
Agriculture
Economic Impacts of
Advancing Technology
How does technological innovation
impact agriculture?
 Major Technological Advancements in
Agriculture
 Mechanization
 ...
 Technology Impacts the Supply of
Agricultural Products
 Supply Shifters
 Prices of Related Goods
 Corn – Soybeans
 C...
How does technological innovation
impact agriculture?
 What Does that Supply Shift Look Like?
Supply
Price
Quantity
Suppl...
Supply and Demand Elasticities
 Demand Elasticity for Agricultural Products
 Inelastic Demand, Why?
 What does that mea...
Supply and Demand Elasticities
 Supply Elasticity for Agricultural Products
 Short Run
 Intermediate Run
 Long Run
Sup...
New Technologies in the Livestock
Industry
 Artificial Insemination
 Sexed Semen
 The ability to choose the sex of the ...
New Technologies in the Livestock
Industry
 Cloning
 The ability to make an exact duplicate animal
with the same genetic...
The Case for Beef Cattle
Supply of Beef
Demand for Beef
Price of Beef
Quantity of Beef
Supply1 of Beef
Original Price
New ...
What about the market for Steers?
Supply of Steers
Demand for Steers
Price Steers
Quantity Steers
New Supply of Steers
Nutrient Requirements for Heifers and Steers
0
10
20
30
40
50
60
550 1200
ThousandsofMCalariesrequiredtoreachliveweight
St...
And the market for Heifers?
Supply of Heifers
Demand for Heifers
Price of Heifers
Quantity
New Supply of Heifers
Price Differential Between Steer and Heifer Calves
0
20
40
60
80
100
120
74
80
86
92
Year
$percwt.
Heifers Steers
Price
Quantity
The Technological Treadmill Theory
Supply
Demand
How does technology affect
the total revenue of the farmer...
The Technological Treadmill Theory
Supply
Demand
Price
Quantity
When supply increases from the
technological change, what
...
The Technological Treadmill Theory
Supply
Demand
Price
Quantity
S 1
Supply has increased and Total Revenue
changes from th...
The Technological Treadmill Theory
Supply
Demand
Price
Quantity
S 1
The red shaded region is a loss in
total revenue and t...
The Technological Treadmill Theory
Supply
Demand
Price
Quantity
S 1
Why does this happen?
Inelastic demand of agricultural...
Emerging Technologies in Production
Agriculture Over the Last Decade
 First Generation Technologies
 Biotechnologies tha...
Biotechnology and the Agricultural
Marketing System
 How is the marketing system going to handle
new products that used t...
Other Potential Impacts From
Biotechnology in Agriculture
 This impact on the marketing system could
create opportunities...
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Technology and agriculture

Economic Impacts of Advancing Technology

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Technology and agriculture

  1. 1. Technology and Agriculture Economic Impacts of Advancing Technology
  2. 2. How does technological innovation impact agriculture?  Major Technological Advancements in Agriculture  Mechanization  Chemical Fertilizers  Hybridization  Biotechnology
  3. 3.  Technology Impacts the Supply of Agricultural Products  Supply Shifters  Prices of Related Goods  Corn – Soybeans  Cattle -- Leather  Price of Inputs  Technology – Allows a farmer to produce more with a given level of inputs How does technological innovation impact agriculture?
  4. 4. How does technological innovation impact agriculture?  What Does that Supply Shift Look Like? Supply Price Quantity Supply1 Original Price Q Q1
  5. 5. Supply and Demand Elasticities  Demand Elasticity for Agricultural Products  Inelastic Demand, Why?  What does that mean for the producer?Demand for Food (Necessity) Inelastic Price Quantity Demand for Luxury Automobiles Elastic
  6. 6. Supply and Demand Elasticities  Supply Elasticity for Agricultural Products  Short Run  Intermediate Run  Long Run Supply - Short Run Price Quantity Supply - Intermediate Run Supply - Long Run
  7. 7. New Technologies in the Livestock Industry  Artificial Insemination  Sexed Semen  The ability to choose the sex of the offspring  Why Beef Cattle?  Why Dairy Cattle?
  8. 8. New Technologies in the Livestock Industry  Cloning  The ability to make an exact duplicate animal with the same genetic makeup DollyDolly?
  9. 9. The Case for Beef Cattle Supply of Beef Demand for Beef Price of Beef Quantity of Beef Supply1 of Beef Original Price New Price
  10. 10. What about the market for Steers? Supply of Steers Demand for Steers Price Steers Quantity Steers New Supply of Steers
  11. 11. Nutrient Requirements for Heifers and Steers 0 10 20 30 40 50 60 550 1200 ThousandsofMCalariesrequiredtoreachliveweight Steers Heifers
  12. 12. And the market for Heifers? Supply of Heifers Demand for Heifers Price of Heifers Quantity New Supply of Heifers
  13. 13. Price Differential Between Steer and Heifer Calves 0 20 40 60 80 100 120 74 80 86 92 Year $percwt. Heifers Steers
  14. 14. Price Quantity The Technological Treadmill Theory Supply Demand How does technology affect the total revenue of the farmer over time?
  15. 15. The Technological Treadmill Theory Supply Demand Price Quantity When supply increases from the technological change, what happens to Total Revenue? Total Revenue = Price * Quantity P Q TR
  16. 16. The Technological Treadmill Theory Supply Demand Price Quantity S 1 Supply has increased and Total Revenue changes from the tan box to the blue box. New Total Revenue = Price1 * Quantity1 P P1 Q Q1 TR1
  17. 17. The Technological Treadmill Theory Supply Demand Price Quantity S 1 The red shaded region is a loss in total revenue and the green shaded region is the gain. Since the loss is larger than the gain Total Revenue has gone down. P P1 Q Q1 Loss G A I N
  18. 18. The Technological Treadmill Theory Supply Demand Price Quantity S 1 Why does this happen? Inelastic demand of agricultural commodities.P P1 Q Q1 Loss G A I N
  19. 19. Emerging Technologies in Production Agriculture Over the Last Decade  First Generation Technologies  Biotechnologies that have made it to market  Flavr SavrTM Tomatoes in 1994  Bt Cotton  Roundup Ready Soybeans  Second Generation Technologies
  20. 20. Biotechnology and the Agricultural Marketing System  How is the marketing system going to handle new products that used to be just commodities? Commodity Value Added Product
  21. 21. Other Potential Impacts From Biotechnology in Agriculture  This impact on the marketing system could create opportunities for other products as well.  Non-Traditional Crops  Organic Crops  Heritage Crops and Livestock

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    Feb. 15, 2019
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    Sep. 6, 2019

Economic Impacts of Advancing Technology

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