An Economic Analysis of Expenditures on Agricultural Experiment Station Research

Experiment station research expenditures are responsive to economic and institutional forces. A four-equation model of resources allocation to state agricultural experiment station research, consisting of demand and supply equations for research, an equation allocating state governmental revenues to station research, and an expenditure identity, is presented. A reduced-form expenditure equation, derived from this model, is fitted to cross-sectional data for forty-eight U.S. states, pooled together for 1960, 1965, and 1970. A large share of the variance in per capita expenditures of state agricultural experiment stations is explained by the variables included in the model.