What is in this article?:
- Cutting Corners the Smart Way
- ECONOMICS OF EARLY ADOPTION
ECONOMICS OF EARLY ADOPTION
Kansas State University Extension Ag Economist Kevin Dhuyvetter explains why early adopters benefit the most from their innovation: “The producers with the lowest per-unit cost of production generally make the most money, and they bid up cash rents to get more land. Those not adopting a new technology find themselves falling behind because their costs lie above what cash rents support.”
Dhuyvetter points out that an example of this today is auto-steer. “Several years ago, no one used it, and tomorrow most everyone will use it. Once everyone uses it, it's no longer an advantage.
“When Western Kansas farmers adopted the rotation of wheat-milo-fallow, it provided an economic benefit relative to wheat-fallow. After this became the typical rotation in an area, the wheat-fallow growers found it hard to pay the going cash rents. They were using old technology that couldn't support higher rents caused by new technology.”