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esistance. It is conceptually and practically difficultto assess the total utility farmers would compromiseby reducing the area sown to susceptible varieties, orin this case, varieties lacking durable resistance.Various factors not necessarily related to resistanceaffect farmers’ choice of cultivars and their rate ofvarietal replacement (Heisey 1990; Brennan andByerlee 1991; Heisey and Brennan 1991; Brennan etal. 1994; Marasas 1999). Farmers do not necessarilygrow wheat cultivars with the socially desirable levelof rust resistance (Heisey et al. 1997). For example,some cultivars with race-nonspecific resistance couldcarry slight yield penalties in disease-freeenvironments, even though their use in leaf rustprone areas could provide substantial protection tograin yield and other traits (Singh and Huerta-Espino1997). Farmers may therefore continue to growvarieties with levels of resistance that wheatscientists may no longer consider satisfactory.Furthermore, neither breeders nor farmersnecessarily know ex ante the specific type ofresistance, and its durability, in a variety when it isreleased. Proof of durability comes only afterwidespread, successful cultivation of the variety inan environment favorable to leaf rust. The historicalperformance of resistances in fact helps breeders toidentify durable sources for future use.Due to the variability of the rust pathogen and itsability to evolve, it is assumed that breeding effortswill continue to address possible mutations. Becauserace-nonspecific resistance appears to last longer,CIMMYT’s emphasis on this type of resistance seemsjustified. If incremental costs were calculated forrace-nonspecific compared to race-specific resistance,the breeding costs for race-specific resistance arelikely to be greater than those for race-nonspecificresistance (Smale et al. 1998). Assuming that newresistance genes are increasingly scarce, the cost ofsearching for them in wheat materials rises overtime. Once the frequency of effective race-specificgenes diminishes in advanced materials, genes willhave to be sought in other materials such aslandraces and wild relatives. The cost of transferringresistance from these materials into advanced lines ishigher. In the meantime, the changing pattern of rustraces will necessitate the continued allocation ofresearch resources to search for and incorporateresistance. This could absorb much of the researcheffort and slow progress in improving othercharacteristics (Borlaug 1968). Instead, pursuing racenonspecificforms of resistance usually impliesworking within advanced lines for new partiallyeffective genes and gene complexes. New sources ofpartially effective resistance are accumulated in elitelines carrying known sources of resistance.Several features of plant diseases in developingcountries suggest that our calculations haveunderstated dimensions of benefits from leaf rustresistance that are difficult to measure but importantto recognize (Smale et al. 1998). Output losses fromrust include both incremental annual losses and themajor losses incurred by epidemics. Theconsequences of not having resistance could becatastrophic (Lakhanpal 1989). How sociallyimportant these losses are depends not only on theirabsolute magnitude, but also on the role of wheatproduction in the national economy, the attitude ofthat society towards risk, the time horizon, and otherconsiderations influencing the valuation of the yieldloss. For some farmers and societies, the true costs ofthese losses, especially in epidemics, can be greatbecause of the extent to which they rely on the wheatcrop. Large crop losses may imply price increases,which are passed on to consumers, or unforeseenimports purchased at world market prices, whichmay not be favorable. Epidemics may requiretreatment with fungicide and large-scale, wellcoordinatedmobilization campaigns, as was the casein northwestern Mexico during the wheat leaf rustepidemic in 1976-77 (Dubin and Torres 1981).However, this option might not be feasible for manyfarmers and societies in the developing world.An estimated two-thirds of ME 1 is on the Asiansubcontinent, where vast historic devastation fromrust epidemics has been reported. Though it is wellaccepted that famines are caused by the loss ofentitlements to food rather than food supply, it is notknown for certain what the effects of greaterproduction instability would have been on particularsocial groups, such as small-scale farmers and ruralconsumers. It would also be difficult to estimate themonetary and health costs of the alternative togenetic resistance, which is to treat the problem bychemical methods. Some farmers and societiestherefore place a premium on avoiding disasters.Genetic leaf rust resistance changes the yielddistribution by reducing the probability that yieldswill occur within the lower range and therebyreduces the probability of disaster.Furthermore, some diseases defined as public riskdiseases (Brennan et al. 1994) can readily spread fromone farm to another. Farmers who grow cultivarssusceptible to these diseases not only place their ownproduction at risk, but also increase the likelihood ofother farmers suffering losses. A particular form ofloss is the increased probability that a newphysiological race of a pathogen may evolve, whichmay overcome the effects of cultivars resistant at thetime. Rusts are in the high risk category considering29
their history of variation, polycyclic nature, and theability of their primary and secondary inoculum tobe transmitted over long distances.This study underscores the importance ofmaintenance research in crop breeding programs.Substantial economic returns were estimated byvaluing the yield losses avoided through leaf rustresistance and assuming all other wheat breedingbenefits as pure benefits. The findings supportresearch at CIMMYT indicating that part of theprogress in wheat yield gain over the years has beenachieved by protecting this yield potential throughdisease resistance breeding (Bohn and Byerlee 1993;Byerlee and Moya 1993; Byerlee and Traxler 1995;Rajaram et al. 1996; Sayre et al. 1998; Smale et al.1998; Heisey et al. 1999). Analyses of trial resultsimply that genetic leaf rust resistance contributed82% of the average annual growth in yield potentialin northwestern Mexico (Sayre et al. 1998).Maintaining disease resistance can potentiallycontribute more to the benefits of these cultivarsthan gains in yield potential alone.As crop productivity rises, increasing effort isrequired to maintain previous gains. The constantlyevolving pest and disease complex has continued toprompt the turnover of wheat varieties, and findingnew solutions to these problems has been a majorobjective of research in entomology, plantpathology, weed science, and plant breeding.Without sustained investment in maintenanceresearch, crop productivity and stability wouldeventually decline. The valuation of agriculturalresearch is therefore incomplete without accountingfor the losses that would have occurred in theabsence of its maintenance component (Moseman1970; Araji et al. 1978; Knutson and Tweeton 1979;Schuh and Tollini 1979; Ruttan 1982; Evans 1983;Peacock 1984; May 1985; Swallow et al. 1985;Plucknett and Smith 1986; Adusei 1988; Pardey andRoseboom 1989; Adusei and Norton 1990; Bohn andByerlee 1993; Alston et al. 1995).Most assessments of the returns on wheat researchinvestments have nevertheless focused onproductivity enhancement (Evenson 1998). Thereare comparatively fewer economic analyses of thevalue of pest and disease resistance in wheat(Doodson 1981; Heim and Blakeslee 1986; Blakeslee1987; Brennan and Murray 1988; Priestley andBayles 1988; Brennan et al. 1994; Morris et al. 1994;Collins 1995; Smale et al. 1998; Marasas 1999).Economists may thus have tended to undervaluethe productivity losses avoided through wheatresearch. Townsend and Thirtle (2001) haveillustrated the magnitude of this error, and suggest aminimum underestimation of 50% on the returns onlivestock research when the negative effects ofdiseases were not explicitly taken into account. Thesefindings may also apply to returns estimates forwheat research, especially considering thatmaintenance has been reported to comprise a higherproportion of crop than of livestock research in theUSA (Adusei and Norton 1990).As Townsend and Thirtle (2001) also emphasize, wedo not suggest that maintenance research isunderestimated because of a lack of understandingor effort. Instead, valuation of the benefits frommaintenance research is often restricted by datalimitations and by the difficulties in separating thecosts and benefits of maintenance from enhancementresearch. However, we conclude that rate of returnestimates which assume that crop breeding explainsonly positive productivity growth, and thatproductivity would remain unchanged in theabsence of research, are bound to be understated.Increases in population, income, and urbanization indeveloping regions necessitate continued growth incereal productivity (Borlaug 1965; Pingali and Heisey2001). The genetic progress necessary to sustain therequired growth will be forthcoming only ifsufficient investments in agricultural research andeducation are maintained. In contrast, long-termdeclines in world cereal prices and structuraladjustment in developing countries have oftenresulted in decreasing research investments in recentyears. At CIMMYT, the real investment in wheatgenetic improvement has declined substantiallysince the late 1980s (Figure 6, Heisey et al. 2002).Models of the world food economy show that thewheat sub-sector of developing nations is expectedto suffer annual welfare losses of nearly 7 billion1990 US$ by the year 2020, if further annualreductions in public investments in research andinfrastructure are assumed (Rosegrant et al. 1995).These global funding constraints increasinglyunderline the need to ensure that research programsgenerate attractive economic returns, such as thosedemonstrated for leaf rust resistance breeding inCIMMYT-related spring bread wheat. Stronglysustained investment in agricultural research isneeded, not only to maintain past productivity gains,but also to meet demands for further growth. Thiscalls for a clear comprehension of the total utility ofagricultural research, including its maintenancecomponent, to facilitate enlightened policy decisionsregarding resource allocation and priorities.30
Page 1 and 2: E c o n o m i c s P r o g r a m P a
Page 3 and 4: CIMMYT® (www.cimmyt.org) is an int
Page 5 and 6: TablesTable 1. Summary of parameter
Page 8 and 9: The Economic Impact in DevelopingCo
Page 10 and 11: origins or pedigrees are selected f
Page 12 and 13: Most assessments of the returns on
Page 14 and 15: MethodologyIn the capital investmen
Page 16 and 17: likely behavior was predicted based
Page 18 and 19: Table 3. Estimated yield losses fro
Page 20 and 21: esults showed that the annual progr
Page 22 and 23: decreasing percentage of the bread
Page 24 and 25: arising from this assumption may be
Page 26 and 27: Table 6. Discounted gross benefits
Page 28 and 29: our base scenario was minimal (Tabl
Page 32 and 33: ReferencesAdusei, E.O. 1988. Evalua
Page 34 and 35: Nagarajan, S., and L.M. Joshi. 1985
Page 36 and 37: Appendix ADefinition of CIMMYT mega
Page 38: ISSN: 1405-7735International Maize

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