The Productivity and Allocation of Research: U.S. Agricultural Experiment Stations

In this paper are presented estimates of the marginal products and internal rates of return to investment in agricultural research by commodity groups (cash grains, poultry, dairy, and livestock). The results are reported both in terms of national aggregates and on a state-by-state basis. Internal rates of return for the country as a whole range from 36% to 46%. At the state level the evidence suggests that the payoff to research is greatest for the commodities with the largest absolute value of output.