Ricardo Guzman

Low-income countries are increasingly establishing intellectual property rights (IPR) for plant varieties as a means to encourage innovation in crop technologies. Whether such policies spur agricultural development is unclear: on one hand, IP protection can bring new crop technologies to markets, expanding the set of inputs available to farmers. On the other hand, the policy can raise input prices and reshape informal seed exchanges that smallholder farms rely on. This paper studies these tradeoffs in a context of a landmark reform that strengthened IP protection for plant varieties in Tanzania. I first combine the universe of registered plant varieties released in the national market with an event study to establish that IP protection brought in new plant varieties. I then estimate the effect of the arrival of these patented technologies on agricultural outcomes using farm-level data and a shift-share design that leverages the staggered release of new varieties and agro-climatic variation in crop suitability across regions. I find that the policy lifted supply-side constraints: a 1SD increase in exposure to patented technologies boosted adoption of improved varieties by 6.7 percentage points. However, the resulting productivity gains were unevenly distributed: the policy delivered higher yields, crop revenues, and profits for larger and better-connected farms, while smaller and more remote farmers experienced little to no benefit. Rising seed prices in local markets and sluggish adjustments in complementary inputs emerge as key channels driving the unequal distribution of the gains from adoption.