The gain from pesticide applications with variety i increases as (a) Output price increases dAnf /dp>0, (b) potential output increases dA 7t[ Idyf > 0, (c) input price declines dAnf / dw < 0, (d) pest population increases dAnf /dN >0, (e) the kill rate of the GMOs decreases, i.e., pest survival increases dAnf / dBj <0, and (f) pesticide application cost decreases dAnf /dF-/1 <0.

With either traditional or GM varieties, farmers will use pesticides when An{ > 0. The gains from use of pesticides are likely to be smaller with the adoption of GMVs. Thus, the adoption of GMVs may eliminate the use of pesticides rather then reduce it from xl0 to x\n. The likelihood of eliminating the use of pesticides with the adoption of a GMV is higher when the generic GMV rather then local GMV is introduced, since the benefits of pesticides are smaller with the generic variety.

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