Given the importance of agricultural R&D investment to sustain agricultural growth in the future, this study looks at the state of agricultural R&D investment in LAC, with the goal of identifying the level of underinvestment in the region. To do this the study uses a new indicator, the ASTI Intensity Index (AII) to measure agricultural R&D intensity in Latin America and the Caribbean (LAC) and compares research intensity with that of other regions and between countries within the region. The index can be used to identify potential under investors, determine intensity gaps and quantify R&D investment needed to close this gap by comparing countries with similar characteristics. Results obtained using a sample of 100 countries including 29 LAC countries show that despite rapid growth in R&D investment after 2004, the region shows low levels of intensity and the largest R&D intensity gap when compared to other regions. Results also show large differences between countries in the region. The Southern Cone (Brazil, Argentina, Chile, Uruguay and Paraguay) is among the regions showing highest levels of research intensity globally. Low levels of R&D intensity in the region are explained mainly by countries in Central America and by Andean countries. Results also show that the intensity gap represents almost 75 percent of total R&D investment in 2012 and that the region will need to increase investment from $5 to $8.5 billion 2011 PPP to close the intensity gap.

Between 2001 and 2012, Latin America and the Caribbean’s (LAC) agriculture saw its best performance of the last 30 years. Given the importance of agricultural R&D investment to sustain agricultural growth in the future, this study looks at the state of agricultural R&D investment in LAC, and analyzes the role that this investment played in the performance of agriculture in recent years. This is done by developing a new approach for the estimation of knowledge stocks that allow us to obtain R&D elasticities and measures of return to R&D investment that avoid some of the major problems encountered in the literature that uses econometric methods.

This report provides a quantitative assessment of the impacts of alternative investment options on the CGIAR’s SLOs (relating to poverty – SLO1, food and nutrition security – SLO2, and natural resources and ecosystem services – SLO3) in the context of changes in population, income, technology, and climate to 2050 as well as for key SDGs of importance to the developing world. The report serves as a source of information and evidence of the impact of CGIAR efforts in agricultural R&D as well as the role of complementary investments. It is intended to help the CGIAR Centers, CG Research Programs (CRP), system management, and donors to complement other efforts to assess the overall impact and benefits of investing in international and national agricultural research programs.

The agriculture sector is key for economic and social development, but the sector’s potential has not received enough attention from policy makers and stakeholders in the Middle East and North Africa (MENA) region. Political transitions, instability, and the resulting refugee crisis have shifted focus away from other pressing development challenges, including slow progress in economic diversification, high unemployment, and persistent high food insecurity and rural poverty. Despite its small contribution to GDP, agriculture is strategic for sustainable development in the MENA countries. Agriculture, for example, is central to achieve food and water security in a region characterized as one of the most food insecure and water scarce in the world. The sector’s role in employment is also central, given the region’s high structural unemployment. However, it will not be possible for MENA countries to develop agriculture without a pathway to structural economic transformation. The region has already started the process of transformation but longstanding challenges remain. This report aims to examine the drivers, constraints, and social implications of agricultural development in MENA and to explore possible cornerstones for new and sustainable development strategies in the context of economic transformation. More specifically, the report provides answers to the following questions: • What development strategies and policies did governments in MENA put in place over the past three decades and how did they affect the performance of agriculture? • How did the structural characteristics of the MENA countries affect agricultural development and the economic transformation process in the region? • What did we learn from the past performance of agriculture? What should be the central elements guiding future agricultural policies? • What are elements of a new and sustainable development strategy in MENA countries? • What is the role of agriculture and agro-industries for development in MENA?

The 2019 report of the Global Commission on Adaptation for accelerated action to adapt to climate change included a call for increased allocation of resources to international agricultural research. The production and adaptation challenges faced by agriculture will be most acutely felt in Africa and South Asia, focus regions of the CGIAR, the world’s largest public food systems research network. These challenges come at a time when the CGIAR is undergoing a transformation of its partnerships, knowledge, assets and global presence, emerging as One CGIAR, aimed at sharpening its mission and impact focus to 2030 and beyond, in line with the Sustainable Development Goals. Evidence on the impacts of CGIAR research since the 1980s have consistently found high rates of return to investment. How could this evidence on the performance of the CGIAR and its partnership with NARS in developing regions be used to inform investment priority setting and to achieve the One CGIAR goals in the coming years? We used detailed R&D investment data from the CGIAR, NARS (ASTI) and evidence from the literature on returns to CGIAR investment by crop and region to develop and calibrate a model of R&D investment that allows us to conduct priority-setting analysis of alternative CGIAR investment across research activities and regions. The model developed can be linked to global partial equilibrium and economy-wide forward-looking models to analyze the effect of different CGIAR investment options under alternative future scenarios. We checked the plausibility of the results obtained by the model calculating the Benefit-Cost ratio of historical CGIAR investments and found that each dollar invested by the CGIAR between 1971 and 2018 returned almost 10 dollars in output as the result of increased productivity, which is within the range of returns found by most recent meta-analyses impact of CGIAR investment. An application of the model to SSA shows that the best results for the CGIAR are obtained from investments in cassava and potato in Southern Africa; yams, sorghum, cassava and groundnuts in West Africa; cassava in East Africa and groundnuts and shoats in the Sahel.

It has been apparent for more than a century that future economic progress in agriculture will be driven by the invention and application of new technologies resulting from expenditure in research and development (R&D) by governments and private firms. Nevertheless, it is conventional wisdom in the economic development literature that there is a significant underinvestment in agricultural R&D in developing countries. Evidence supporting this belief is provided, first by a vast literature showing returns on R&D expenditure to be so high as to justify levels of investment in multiples of those actually found, and second, from available data showing low research effort in developing countries as measured by the intensity ratio (IR), that is, the percentage of agricultural gross domestic product invested in agricultural R&D (excluding the for-profit private sector). This paper argues that the IR is an inadequate indicator to measure and compare the research efforts of a diverse group of countries and proposes an alternative index that allows meaningful comparisons between countries. The proposed index can be used to identify potential under-investors, determine intensity gaps, and quantify the R&D investment needed to close these gaps by comparing countries with similar characteristics. Results obtained using the new R&D intensity indicator with a sample of 88 countries show that the investment effort in developing countries is much higher than the one observed using the conventional IR measure. The new measure finds that countries like China, India, Brazil, and Kenya have similar levels of R&D intensity to those in the United States. To close the R&D intensity gap measured by the new index, developing countries will need to invest US$7.1 billion on top of the $21.4 billion invested on average during 2008–2011, an increase of 33 percent of total actual investment.

This report assesses the cost of adaptation to climate change across a range of future climate scenarios and investment options. We focus on offsetting climate change impacts on hunger through investment in agricultural research, water management, and rural infrastructure in developing countries. We link climate, crop, water, and economic models to (1) analyze scenarios of future change in the agriculture sector to 2050 and (2) assess trade-offs for these investments across key Sustainable Development Goals (SDGs) for poverty, hunger, and water. Our reference projections show that climate change slows progress toward eliminating hunger, with an additional 78 million people facing chronic hunger in 2050 relative to a no-climate-change future, over half of them in Africa south of the Sahara. Increased investments can offset these impacts. Achieving this would require that annual investment in international agricultural research increase from US$1.62 billion to US$2.77 billion per year between 2015 and 2050. Additional water and infrastructure investments are estimated to be more expensive than agricultural R&D at about US$12.7 billion and US$10.8 billion per year, respectively, but these address key gaps to support transformation toward food system resiliency. Findings on ranges of costs and trade-offs and complementarities across SDGs will help policymakers make better-informed choices between alternative investment strategies.

This analysis explores the relationship between agricultural R&D investments and rural poverty reduction, and the prevalence of undernourishment in sub-Saharan Africa (SSA). It uses a panel data set of internationally comparable poverty dis-aggregated by urban and rural areas, country level undernourishment, and ASTI data on R&D investments and derived indicators. The study uses agricultural R&D knowledge stocks (KS) to account for the lagged effects of research through depreciation and gestation period of investments, and applies causal mediation analysis to assess the impact of KS on poverty and hunger and measure the relative contribution of KS-induced agricultural productivity growth on those outcomes. Evidence suggests that, while SSA growth in KS has been relatively slow, it helped reduce rural poverty and undernourishment – the percentage point reduction in rural extreme and moderate poverty of a 1% annual increase in KS is 0.218 and 0.146 percentage points per year, respectively. Mediation analysis indicates that a fifth of the KS effect on extreme rural poverty, and a quarter of the KS effect on moderate rural poverty, can be attributed to KS driven gains in agricultural labor productivity. Likewise, KS growth reduces undernourishment – a 1% annual increase in KS leads to a drop of 0.132 percentage points per year in the prevalence of undernourishment, with about 40% of that effect mediated through gains in agricultural land productivity. These results indicate that KS supports poverty and hunger reduction through benefits on-farm and beyond it. They also suggest that there is room for strengthening the role of R&D KS productivity enhancing innovations. Given the current low levels of investments in R&D and resulting KS, increasing its levels will be critical, but that alone is not sufficient. Policy makers will have to rethink the way the innovations from R&D get scaled up and pay attention to the necessary complementary policies and investments that enable a sustainable pathway leading to greater productivity growth and development impacts.

Between 2001 and 2012, Latin America and the Caribbean’s (LAC) agriculture saw its best performance of the last 30 years. What were the implications of this growth for family agriculture (FA) in the region? This study contributes to answer this question by looking at the case of Paraguay, a country with one of the fastest growing agricultural sectors in the region during this period. At the center of the development challenges faced by this country is the debate on the role of family agriculture and smallholders in a future growth strategy. Between 1991 and 2008 the number of family workers in agriculture decreased significantly, while the total area of FA crops decreased to only 48 percent of its level in 1991. As some authors argued in the past, the 2000s represent a turning point for FA development in Paraguay, given that until 2002, the total area of farms of less than 20 hectares was still increasing, a trend that reversed after this year. Are these changes, part of a process of impoverishment of the rural population resulting from displacement of FA by the commercial sector as is normally assumed in previous studies? Evidence from this study shows that rural poverty decreased almost by half between 2003 and 2015; that the reduction of output of crops traditionally produced by FA was not the result of competition with the commercial sector, but mostly a consequence of the collapse of cotton production, a failure of a government program for FA; and that in regions with high proportion of FA, commercial crop production expanded by displacing inefficient extensive livestock farmers and not FA agriculture. We conclude that the situation of FA in Paraguay is much more diverse and complex than the simple claims of decomposition and disappearance as the result of the expansion of capitalist farmers. In this context, there are options for the government to promote the development of FA with the goal of increasing employment opportunities in rural areas while achieving a much-needed diversification of agricultural production and exports.

This study proposes the use of partial least squares to determine the key parameters of the perpetual inventory method model of capital stock as a new approach to calculate research and development (R&D) knowledge stocks and R&D elasticities. This approach avoids most of the major problems encountered in the literature that lead to obtaining very high and implausible rates of return to agricultural R&D...Using this approach, we obtain an average R&D elasticity for low- and middle-income (LM) countries of 0.23 and an average rate of return to R&D investment of 6.0 percent, bigger than the average discount rate of 4.2 percent for these countries. Results show that 60 percent of LM countries in our sample are underinvesting in agricultural R&D, as they can get higher returns by investing in this activity than in activities that return the social discount rate.