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On Economics and Politics of Agriculture

Theodore W. Schultz
Bulletin of the American Academy of Arts and Sciences
Vol. 32, No. 2 (Nov., 1978), pp. 10-31
DOI: 10.2307/3822671
Stable URL: http://www.jstor.org/stable/3822671
Page Count: 22
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On Economics and Politics of Agriculture
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Abstract

In September 1977 the Midwest Center of the Academy sponsored a workshop on "Resources, Incentives and Agriculture" under the chairmanship of Theodore W. Schultz, Professor of Economics at the University of Chicago. This project was supported by a grant from the International Development Research Centre of Canada. Participants included agricultural economists and scientists concerned with the development of policies that will increase food supplies in low-income countries; they represented academic, research, and policy institutions in America and abroad. Present at the workshop were Martin Abel (Schnittker Associates, Washington, D.C.), Randolph Barker (International Rice Research Institute, Philippines), Gilbert T. Brown (World Bank), Emery Castle (Resources for the Future, Washington, D.C.), John Crawford (The Australian National University), Robert E. Evenson (Yale University), Keith Findley (International Maize and Wheat Improvement Center, Mexico), Earl O. Heady (Iowa State University), Reed Hertford (The Ford Foundation), W. David Hopper (World Bank), D. Gale Johnson (University of Chicago), John W. Mellor (International Food Policy Research Institute, Washington, D.C.), Charles Pereira (Ministry of Agriculture, Fisheries and Food, United Kingdom), Rati Ram (University of Chicago), Vernon Ruttan (University of Minnesota), G. Edward Schuh (Purdue University), Theodore W. Schultz (University of Chicago), Howard Steppler (McGill University), Paul E. Waggoner (The Connecticut Agricultural Experiment Station), Finis Welch (The Rand Corporation), and Joseph W. Willett (United States Department of Agriculture). Papers prepared for the workshop will appear in a volume entitled Distortions of Agricultural Incentives to be published this fall by the Indiana University Press. The study focuses on government policies that reduce the world food supply by discouraging the application of the results of agricultural research and the allocation of additional capital to food production in developing nations. The opening section of the volume provides an overview of constraints on agricultural production in developing countries, including inadequate use of scientific advances and the absence of managerial skills. In addition, attention is given to the effects on agriculture of such environmental conditions as climate, distribution of energy sources, and soil quality. Subsequent contributions analyze policies that distort incentives to agricultural production in low-income countries such as government prohibitions on the importation and use of agricultural products (for example, certain kinds of seeds and fertilizers), and pricing policies that are designed to keep food prices low for the benefit of the urban population yet, at the same time, act as barriers to further agricultural investment and productivity. This section concludes with a chapter on the hard policy choices that confront low-income countries which try in this way to promote industrialization at the expense of the agricultural sector. In the next section, an analysis of prices and trade patterns for agricultural products on international markets broadens the scope of the discussion to consider the worldwide effects of pricing policies. Other approaches toward increasing the food supply are then presented in chapters dealing with the organization of agricultural research in low-income countries, the role of education, and institutional innovations such as improved credit and extension services or alternative land tenure arrangements. The volume concludes with a review of policies which, although designed to fulfill "basic needs" and to promote equality, have tended to distort agricultural incentives; in addition, it offers suggestions about alternative policies that might promote equity and efficiency at the same time.

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