AGRICULTURAL ECONOMICS,INTERDEPENDENCE AND UNCERTAINTY*

Interdependence has always been central to economics but assumes pressing importance for agricultural economists as they deal with industrialising agricultures. Continued unresolvable uncertainties, when properly recognised, also add to the challenge of relevant work in agricultural economics. The related roles of interdependence and uncertainty are illustrated through examples from the progress of agricultural technology and enhancement of food security.     

RURAL EXTENSION AND THE AGRICULTURAL ECONOMIST*

The role of the agricultural economist in rural extension is discussed with particular reference to the changing structure of extension, exemplified by the development of private consulting services and the changing orientation of extension from purely technical considerations to problems of management. The status of the agriculturist generally, and of the extension worker in particular, is also examined and it is concluded that the status of extension as a profession must be raised if the results of technical and economic research in agriculture are to be utilised effectively.     

RELATIVE COST-EFFECTIVENESS OF INPUT AND OUTPUT SUBSIDIES*

A subsidy on a single input is compared with an output subsidy as a means of stimulating output, and the conditions under which the single input subsidy is (a) more treasury cost-effective and (b) overall the more socially efficient measure, are explored. Rationalisations for input subsidies, particularly fertiliser subsidies, are examined in the light of the results.     

BELIEFS AND VALUES IN AGRICULTURAL ECONOMICS RESEARCH*

Attention is drawn to the values that are often kept hidden but condition what research agricultural economists do. It is pointed out that the economic theory, which guides most research, is not value free and that therefore the lack of debate about theory amongst Australian agricultural economists may be unhealthy. In a world with uncertainty, the research process is likened to learning, leading to a suggestion that Bayesian procedures provide a more satisfactory conceptual framework for the process of enquiry than does the conventional hypothesistesting approach. While difficulties in the practical applicability of Bayesian methods are understood, they do provide insights which permit some of the more inappropriate uses of hypothesis testing to be recognised. The view of research enquiry as learning also leads to an appreciation of the desirability of a more honest acceptance of the inherent subjectivity of the process. Finally, attention is drawn to the need for vigilance over professional standards in research.     

AGRICULTURAL TRADE LIBERALISATION AND THE URUGUAY ROUND*

With the Punta del Este Declaration, agriculture was accorded prominence in the GATT negotiations and, for the first time, national support policies were on the agenda. In this paper, the progress of the negotiations on agriculture is reviewed in an attempt to understand the factors which shaped the final outcome and to assess the likely impact of the round on liberalising agricultural trade. Although the immediate impact is likely to be modest, the round will provide longer term benefits to agricultural trade through the extension of the GATT rules-based system to agriculture. The framework which has been laid should provide a sound basis for future negotiations. Within the multilateral framework, the pace of change is a function of the willingness of all parties to compromise and this is evident in the Uruguay Round's outcome which reflects the European Union's agricultural reform agenda.     

CONSTITUTIONAL AND INSTITUTIONAL CONSTRAINTS IN AGRICULTURE AND AGRICULTURAL POLICY*

When men are committed to technology they are also committed to continual change in institutions and customs [8, p. 72]. Nowhere does the fervor for this arcadian age reach such a crescendo as it does with the odes that are dedicated to the whooping crane of the American economic scene, the ‘family farm’ [6, p. 171].     

AGRICULTURAL REFORMS IN CHILE AND NEW ZEALAND: A REVIEW*

Chile and New Zealand are both small countries for which agricultural exports are important: both undertook comprehensive economic reforms during the 1970s and 1980s respectively. Comparison of the experiences shows that macroeconomic policy, above all the resulting movements in the real exchange rate and in interest rates, has a critical impact on agriculture. In both cases, rolling back the state has encouraged private responses. In Chile the challenges ahead lie in continuing productivity improvements, and in raising the welfare of smallholders in marginal areas. Six years after the initiation of reforms, New Zealand agriculture shows a healthy recovery. Once committed to economy-wide reforms – stabilisation, adjustment, and trade liberalisation – and companion reforms of institutions, how do governments best proceed? With what reforms and in what mix, sequence, strength, and speed? For agriculture, specifically, this paper takes a close look at which reforms, or aspects of their implementation, can accelerate or slow down private investment and aggregate supply response.     

RELATIVE PRICE VARIABILITY AMONG AGRICULTURAL COMMODITIES AND MACROECONOMIC INSTABILITY IN THE UNITED KINGDOM

This paper develops measures of relative price variability among agricultural commodities in the UK farm sector for the period 1956-88. Econometric tests of the hypothesis that relative price variability is positively correlated with instability in the macroeconomy are carried out. The results indicate that UK agricultural commodity prices become more volatile relative to one another when the economy-wide inflation rate increases and when aggregate output becomes more variable. These findings suggest that UK producers and consumers of domestically grown farm products experience increased risk and uncertainty in their production and consumption decisions during periods of macroeconomic instability. The effects of UK entry into the European Community are also examined; no evidence is found to suggest that adoption of the Common Agricultural Policy reduced year-to-year relative price variability among agricultural commodities.     

AGRICULTURAL POLICY ADVICE AND THE PUBLIC INQUIRY PROCESS*

The Industries Assistance Commission came into existence in 1974. It extends to all industries, including the rural industries, the system of public scrutiny of advice regarding assistance. This paper considers the ethos of the IAC's establishment. It discusses some criteria which are features of the IAC's operation, and which are considered to be necessary for an effective public inquiry process. Finally, it comments on the relationship of the IAC to other policy objectives and other advisory instrumentalities.     

THE AGRICULTURAL POTENTIALS OF CANADA'S RESOURCES AND TECHNOLOGY*

Canada's agricultural potential during the 1980's will be constrained by the availability and prices of productive agricultural land, water, energy, labour, and technology. Resources for further expansion of agricultural production are becoming increasingly scarce. Past expansions were made possible largely by the substitution of cheap fossil energy for expensive labour. Further expansion will necessitate new technology that is both energy saving and labour saving. A multifaceted program involving government, farmers, and other components of the food system is needed to achieve Canada's agricultural potentials. Agricultural expansions in the 1990's will depend first upon the success of the programs designed for the 1980's and second upon new scientific knowledge and technological adaptations. Without a massive and well coordinated effort to meet the needs of agriculture, Canada could become a food deficit nation before the end of this century. Le potentiel de ?Agriculture du Canada durant les 1980's va être contraint par la disponibilité et le pri.x de la terre, ?eau, ?energie, le travail et la technologie productive. Les ressources pour ?avancement de la production agricoie deviennent de plus en plus rare. Les expansions du passé ont été possible par la substitution de ?énergie fossile pour le travail dispendieux. Un autre anvancement va nécessiter une nouvelle technologie qui sauvera ?energie et le travail. Un programme qui comprend le gouvernement les fermiers et touts les autres constituents du système alimentaire est nécessaire si le Canada va achever son potential agricoie. Les expansions agricoles des 1990's vont depéndre premièrement du succès des programmes developpés pour les 1980's et deuxièment de nouvelles connaissances scientifique et de nouvelles adaptations technologigues. Sans un effort massif et sans un grand effort coordonné dans le domaine de ?agriculture, le Canada peut devenir un pays qui manque de la nourriture avant la fin du siècle.     

PUBLIC CHOICE THEORY AND AUSTRALIAN AGRICULTURAL POLICY REFORM*

Recent discussion of the process of policy reform has tended to focus on public and private interest theories of public choice as alternative models. The analysis of Australian agricultural policy presented in this paper draws on several extensions of the private interest model including the contractarian framework, extra-rational considerations such as moral attitudes and the desire to participate. Recent agricultural policy reforms in Australia are examined in the light of those theories. This examination highlights the importance of ideas and changes in the rules for policy formulation in influencing policy outcomes. In some cases the private interest theory appears to offer an adequate explanation while, in others, it provides only a partial explanation of policy change, and requires extension if policy choice is to be influenced, or even understood. An important independent role for economists and policy makers is seen both in the formulation of policies and in the design of rules for policy choice.     

AGRICULTURAL CO-OPERATIVE THEORY: A REVIEW*

The notion of a review article would presume that there exists a coherent body of literature on the topic in question. With agricultural co-operative theory this is not quite the case since it has been approached seriously and systematically in some subject areas but disjointedly if at all in others. This review article attempts to ask what predictions can be made about the behaviour of agricultural co-operatives in the present state of theoretical knowledge—thus, each section refers to a topic that readers might hope to have been investigated in the literature, though the findings are necessarily patchy since few areas have been given adequate attention. Where weaknesses and deficiencies occur, I have tried to point them out and to indicate areas for further research. In doing so, I have hazarded my own ideas, so that much of the material is original. As far as I know, for example, nobody has yet seriously considered the life-cycle of the agricultural co-operative organisation, which constitutes the subject matter of section 7, and the discussion put forward in the first half of section 6, on the supply curve of marketing associations, is also my own work. If these are duplicated in papers which I have failed to bring to light in my quest for material for this article, I can only apologise.     

AGRICULTURAL POLICY FORMATION: THE DIFFERING FUNCTIONS OF INDEPENDENT ANALYSTS AND ADVISERS*

Agricultural policy has been analysed systematically in Australia but the process of policy formation is not well understood. Distributional dimensions of policy issues influence decisions and policy analysts might improve their performance by better identification of these dimensions without neglecting basic efficiency criteria. These propositions and the functions of policy advisers are considered in this paper.     

SIMULATED MARKETS,FARM STRUCTURE,AND AGRICULTURAL POLICIES*

In this investigation estimated relationships of resource markets for United States agriculture are used in a simulation model to study resource demand and farm income under three conditions: (a) those actually prevailing, including the historic mix of agricultural policies, (b) with technical change in agriculture only half the rate realized, and (c) with a free market. The results indicate that compared with “actual” conditions the environment of slow technical change would have modest effects in slowing the demand for farm machinery and the migration of labor from agriculture. It also would result in greater net farm income in the 1960's. A free market would be accompanied by increased investment in farm machinery and a greater exodus of family and hired labor from agriculture. It also would result in a smaller farm building investment and a considerable reduction of farm income. Since economic conditions are so similar in both countries, the implications of these findings are related to Canadian agriculture on the assumption the same model would show the same outcomes for Canada. Dans cette étude, des rapports estimés des marchés des ressources pour ?agriculture des Etats-Uns sont employés dans un modéle de simulation afin ?étudier la demande des ressources et le revenu agricol net sous trois conditions: (a) celle qui régne réellement, incluant le mélange historique de politiques agricoles; (b) celle qui ne montre le changement technique de ?agriculture qti à la moitié du train realise; et (c) celle qui profite ?un marché libre. Les résultats indiquent que ?enrironnement du changement technique modéré, quand il est compareé avec les conditions réelles, produirait des effets modestes en diminuant la demande pour des machines agricoles et en ralentissant ?exode de la main-?oeuvre de ?agriculture. En outre, cet environment aurait pour résultat un revenu agricole net plus fort dans les années de 1060 à 1970. Vne marché libre serait accompangne de placements augmentés dans les machines agricoles et ?un plus grand exode de la main ?oeuvre familiale et salariée de ?agriculture. Aussi, ceci aboutirait à un investissement moindre dans la construction rurale et à une réduction considérable du revenu agricole. Puisque les conditions économiques des deux pays sont si ressemblantes, les implications de ces conclusions sont rattachées à?agriculture cana-dienne en supposant que le même modéle montrerait les mêmes résultats pour le Canada.     

RURAL SOCIOLOGY AND ITS RELEVANCE TO THE AGRICULTURAL ECONOMIST: A REVIEW*

Following a discussion of the relationship between agricultural economics and rural sociology, the current status of the latter is discussed, including the differences between European and American approaches. The background to an emerging ‘sociology of agriculture’ is described and recent developments in the sociological analysis of some of its constituent components are considered. Particular attention is paid to the relationship between landholding and the social structure and to the development of ‘agribusiness’ as a vertically-integrated food-production complex. The impact of these on labour relations in agriculture and on the rural community are outlined. The article concludes with an assessment of future trends in rural sociology, concentrating on themes of rural development, the sociology of agriculture and the sociology of natural resources.     

WORLD AGRICULTURAL TRADE AND MERCHANDISING OPPORTUNITIES IN THE 1970s*

"There is going to be a continuing great need for food." In a wide review of Canadian and world markets, the author makes a case for an opportunity-oriented agriculture, geared to the developing and changing market potentials of the 1970s. Canadian and world market potentials for the 1970s present attractive prospects, but the future will only be as bright as agriculture and its institutions are flexible to adapt to the emerging environment.
LES POSSIBILITÉS DE DÉVELOPPEMENT DU COMMERCE MONDIAL AGRICOLE AU COURS DE LA PROCHAINE DÉCENNIE –"Il y a un besoin croissant de biens alimentaires." Au cours ďune large revue des marchés canadiens et mondiaux, ľauteur étudie les chances ďune agriculture orientée, axée sur le développement et le changement des marchés pour les années 1970. Les possibilités de développement des marchés canadiens et mondiaux au cours de la prochaine décennie apparaissent favorables, à condition toutefois que ľagriculture et ses institutions s'adaptent au nouvel environnement.