This paper explores the economic conditions for the viability of organic farming in a context of imperfect competition. While most research dealing with this issue has adopted an empirical approach, we propose a theoretical approach. Farmers have a choice between two technologies, the conventional one using two complementary inputs, chemicals and seeds, and the organic one only requiring organic seeds. The upstream markets are oligopolistic and the firms adopt Cournot behavior. The game is solved backward. The equilibrium distribution of the farmers between both sectors is obtained by a free-entry condition. Since multiple equilibria could exist, including the non-emergence of organic farming, we spell out viability conditions for organic farming. Then, using an “infant industry” argument, we propose several public policy instruments able to support the development of organic farming and assess their relative efficiency. Results could be useful to assess the conditions of emergence and viability of agricultural innovations in analogous contexts.

We characterise the welfare implications of uncoordinated policy decisions in the presence of multiple externalities, illustrated with an aquifer. We concentrate on the problem of coordination that can occur when distinct agricultural and water authorities implement their respective policies (to optimise food production and groundwater use) with environmental concerns in mind. We represent this problem as an open-loop Nash game, which compares the game-theoretical solution to a centrally planned solution. We show that the inefficiencies arise from differences in the account taken of relevant costs by different authorities. We demonstrate that the magnitude of the inefficiency generated by the absence of coordination of our authorities varies depending on the weights put on environmental benefits by each authority, and discuss the implications of analysis for future research and policy.

Advance Disposal Fees (ADF) are quite popular in waste management policies, but they discourage any waste reduction effort at the household level. We propose a tiered ADF policy that enhances this system by giving households the possibility to sign a waste reduction contract in return for a lower fee. These contracts satisfy incentive, budget-balancing and participation constraints. For these feasible contracts, we show that the enriched ADF policy is welfare improving and always induces a waste reduction effort.

In knowledge economies, patent agencies are often viewed as a relevant instrument of an efficient innovation policy. This paper brings a new support to that idea. We claim that these agencies should play an increasing role in the regulation of the relation between private R&D labs and public fundamental research units especially concerning the question of the appropriation of free usable research results. Since these two institutions work with opposite institutional arrangements (see P.S. Dasgupta and P.A. David. 1987. Information disclosure and the economics of science and technology. In Arrow and the accent of modern economic theory , ed. G.R. Feiwel, 519–42. New York: State University of New York Press), we essentially argue that there is, on the one hand, an over-appropriation of these results while, on the other hand, there is also an under-provision of free usable results issued from more fundamental research. We show how a public patent office can restore efficiency.