Genetic Information in Agricultural Productivity and Product Development

A prominent facet of recent changes in agriculture has been the advent of precision breeding techniques. Another has been an increase in the level of information inputs and outputs associated with agricultural production. This paper identifies ways in which these features may complement in expanding the variety of processed products, the level of productivity, and the rate of change in productivity. Using a martingale concept of "more information," we identify conditions under which more information increases the incentives to invest and engage in product differentiation. A theory on how genetic uniformity can enhance the rate of learning through process experimentation, and so the rate of technical change, is also developed.