Quality-oriented technical change in Japanese wheat breeding

The article presents a productivity analysis of Japanese wheat breeding research. We first estimate a hedonic function to determine the marginal implicit values of Japanese wheat characteristics and find that protein contributes substantially to millers' price offers to farmers. Induced innovation theory implies breeders thus should be responding to new protein-oriented price policies by developing high-protein wheat varieties. We test this hypothesis by estimating a distance function relating breeding resources - including what we call gene-recharge rates - to the yield and protein characteristics of discovered varieties. New varieties indeed have been protein-favoring and yield-disfavoring, suggesting government research programs have been market-oriented.