This paper investigates the role of induced innovation in the development of American agriculture from 1880 to 1980. The induced innovation hypothesis, most closely associated with the work of Hayami and Ruttan, argues that successful economies develop technologies in accordance with market price signals to loosen constraints on growth imposed by factor scarcities. Our analysis employing new state and regional level data fails to find support for Hayami and Ruttan's hypothesis. This paper suggests that many of the fundamental generalizations about American agricultural development need to be reconsidered and redirects attention to the role of settlement, changing crop patterns, and biological investments in explaining changes in factor utilization in American agriculture.

This paper investigates the role of induced innovation in the development of American agriculture from 1880 to 1980. The induced innovation hypothesis, most closely associated with the work of Hayami and Ruttan, argues that successful economies develop technologies in accordance with market price signals to loosen constraints on growth imposed by factor scarcities. Our analysis employing new state and regional level data fails to find support for Hayami and Ruttan's hypothesis. This paper suggests that many of the fundamental generalizations about American agricultural development need to be reconsidered and redirects attention to the role of settlement, changing crop patterns, and biological investments in explaining changes in factor utilization in American agriculture.

Arguing that the beliefs that there were no energy shortages in the US before the 1970s and that large-scale rationing requires government price controls are clearly wrong, the authors analyze the extent of the shortage, the nature of the rationing program, and the structure of the petroleum industry. They argue that regional isolation, industry concentration, and the vertical integration of the larger firms made rationing possible. In the absence of laws requiring rationing or setting prices, they focus on the hypothesis that the oil companies held prices down because they were afraid of hostile government actions. 22 references, 2 figures, 1 table.