AGRICULTURE and DEVELOPMENT

1. AGRICULTURE and DEVELOPMENT Cypher and Dietz, Ch. 11

2. The neglect of Agriculture in Development Economics and Policy • Urban bias • Cultural bias • Gender bias

3. Structural Characteristics of Agriculture in Developing Economies:Dependency of Agricultural Development on Governmental Infrastructure Investments Neglect of agriculture → Inadequate investment in: • Infrastructure: roads, dams, irrigation canals, crop storage facilities, far • Social overhead capital: schools, health clinics, farm extension services, agricultural research and development; farm credit programs

4. Structural Characteristics of Agriculture in Developing Economies:Primary Product Mono-exporters

5. Structural Characteristics of Agriculture in Developing Economies:Agrarian Dualism • Agrarian Dualism:large versus small cultivators One study in six LA countries found that an average of 52% of all farmland was controlled by the largest landholders although they constituted less than 1% of all agrarian households in these nations.

6. Agrarian Dualism:Peasant agriculture and small-scale cultivators How to characterize them? • Traditional and modern techniques combined • Modest marketing of cash crops combined with self-consumption of production • Organized around family labor • Little capital, labor-intensive, low productivity, low value-added • Risk averse yet willing to undertake technical change demonstrated to be worth the risk involved Are peasants efficient cultivators? Three approaches • Peasant agriculture has a hidden potential • Peasants are in fact true maximizers in the neoclassical sense • Peasants are inefficient by neoclassical standards yet they endure due a special logic in peasant cultivation

7. Agrarian Dualism:Mid-size Farmers: Cash Crop Producers

8. Agrarian Dualism:Large landholders and Sharecropping • In the less-developed countries, large tracts of land owned by domestic owners rarely used to produce agricultural output in a purely capitalistic manner. • Large owners divide their land into smaller plots to rent out or for sharecropping. • Debate over efficiency of sharecropping versus own land cultivation.

9. Agrarian Dualism:Transnational Agribusiness • Intensive use of modern agricultural technology dependent upon R&D of herbicides, fungicides, insecticides, synthetic fertilizers conducted by TNCs. • Strategies developed for their imposition in developing country agriculture. • Monopolization of land through practices such as vertical integration in increasingly concentrated restaurant business (e.g. McDonald’s using land for exported beef); or for exotic crops production for export to high-income industrialized nations (“strawberry imperialism”). • Transnational agribusiness makes little commitment to high fixed cost assets (land, docks, railroads) in the countries where production is derived.

10. The Green Revolution • Research on new wheat seeds, Mexico 1940-50 • Trials on rice, corn, millet and sorghum • Wide-spread application of these new plant varieties, 1960s • Green revolution, 1968 • Enrichment of large farmers at the expense of small farmers, early 1970s • Small farmers adopt the high-yield varieties with some time lag and raise yields, late 1970s • Increase in productivity yet coupled with environmental degradation reaching the limits of the GR, 1980s onwards

11. Government in Agricultural DevelopmentFree market versus government intervention? • Appropriate policy is one which recognizes both the potential for market failures as well as government failures • Hence policy intervention is necessary to prevent market failures; yet use markets and private marketing sector as the vehicle for those policy interventions. • Policy interventions need to be two pronged: 1. technology development, diffusion and extension coupled with investments in infrastructure; 2. human side policies encouraging dialogue with the farming communities and their active participation in decision making, planning, implementation and evaluation.