Bacillus thuringiensis (Bt) white maize was field tested in El Salvador in 2009. Results showed sufficient pest abatement, eliminating the need for insecticide applications, and an average yield increase of 18% above that of the most widely cultivated conventional hybrid. This article presents an ex ante economic impact assessment of Bt maize adoption in El Salvador. Ten-year economic surplus projections show a considerable welfare gain for the overall economy, with consumers being the principal beneficiaries. Trade implications of adopting Bt maize are analyzed and appropriate alternatives to possible market shutdowns are explored. Results obtained in this study could compliment the agronomic evaluation of Bt maize and become part of the Salvadoran government decision process on Bt maize adoption.
Keywords: Developing Country Innovation; Economic Surplus; Subsistence Farming; Trade; Yield Increase.