Newsletter on bioeconomic and social
research on
Sustainability and Economics in Agriculture
Issue 2, September 1998
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Newsletter on bioeconomic and social
research on |
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Editor:
Dave Pannell, University of Western Australia, email David.Pannell@uwa.edu.au SEA Project main funder: Grains Research and Development Corporation Address of the SEA News web site: http://www1.crcsalinity.com.au/newsletter/sea/ |
In This Issue
Editorial
In
Brief
Adoption of innovations, and the Mallee
Sustainable Farming Project.
Articles:
What
can agricultural researchers do to encourage the adoption of
sustainable farming systems?
Using individual-farm models for resource
conservation problems: Positives and pitfalls
Why is adoption of sustainable farm
practices slow?
Economics of crop/tree phase
farming for dryland salinity management
Policy
Forum:
Comments by Phil Price on
sustainability, Landcare and regulation
Ideas
and Lessons on Sustainability from Overseas:
Adoption of Organic Agriculture in Europe:
Economic and Non-Economic Determinants
Regular
Bits and Pieces
News and Coming Events -
Overview of the SEA Project - People in the SEA Team -
Publications available
Response to the first issue of SEA News was very encouraging indeed. We seem to have tapped into an unmet need for a broadly-accessible forum on sustainability and economics in agriculture. Thanks very much for all the positive feedback. We hope you will find this issue just as interesting and useful. The articles again span a wide range of issues related to sustainable agriculture, including articles on bioeconomic modelling of land conservation practices and more on adoption of innovations in agriculture. There was a particular interest in the articles on adoption of innovations last issue, so we have responded with our own innovation, as outlined below - see "In Brief". This issue also contains several items contributed by people outside the SEA team. Please feel free to do this if you have comments or information you would like to circulate. A number of people forwarded the first issue to others who they thought would be interested. In fact it reached at least 650 people that we know of. This is great, but please also advise us of people you think should be subscribers so that we can add them to our mailing list.
In case you missed the last issue, SEA News is a newsletter canvassing issues related to sustainability and economics in agriculture. Our focus is on bioeconomic and social research results and their implications, but we will not constrain ourselves to this. Much of the research is from the SEA project, funded by Grains Research and Development Corporation. The main way to access SEA News is through email and the web site, but you can also elect to receive a hard copy of the newsletter by snail mail if you prefer - just let me know.
Agricultural Extension and
Adoption of Innovations. There was a particularly strong interest in
the extension and adoption issues covered in SEA News #1.
In response, we have established a new web page containing a
range of UWA research papers in this area. They do not all focus
on adoption of sustainable practices, but all have some relevance
to this. Web page: http://www.general.uwa.edu.au/u/dpannell/adoppprs.htm
Mallee Sustainable
Farming Project Inc. Marion Murphy wrote to tell us about this
farmer-run project aimed at increasing the adoption and
profitability of sustainable farming practices in the Mallee in
South Australia, New South Wales and Victoria. Core research is
being conducted to identify constraints to sustainable farming
systems. Various crop rotations and tillage methods are being
studied for their effect on: erosion, nutrition, soil and plant
disease, yield and groundwater recharge. Please contact Marion
for further details: marion.murphy@nre.vic.gov.au, telephone 03 50223077 or
see this Web page: http://www.general.uwa.edu.au/u/dpannell/mallee.htm
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What Can
Agricultural Researchers do to Encourage the Adoption of
Sustainable Farming Systems? by Sally Marsh "Many of the "sustainable" farming practices that researchers expect farmers to accept do not fall easily into the categories of innovations that are readily adopted." |
At a recent forum
held in Perth, Sally Marsh presented an excellent talk on this
subject to a large group of agricultural scientists. In this
paper, based on the talk, she reviews and discusses the factors
that have been shown to influence the adoption of agricultural
innovations by farmers and suggests that there should be strong
messages for agricultural researchers from this evidence. Many of
the "sustainable" farming practices that researchers
expect farmers to accept do not fall easily into the categories
of innovations that are readily adopted. There are real
difficulties in demonstrating both the effectiveness and
profitability of conservation practices, which make the adoption
of sustainable farming systems slow. Addressing these
difficulties will require innovative approaches by researchers
and extension practitioners. Sally suggests ways we can start
overcoming the problems: by understanding and using the
principles underlying adoption theory, by embracing a more
participatory approach to research that actively involves farmers
in the research process, by working constructively with
farmers’ ‘solutions’, and by broadening the
research approach taken by biological scientists through better
liaison with economists, sociologists and psychologists.
For the full article, see this web page: http://www.general.uwa.edu.au/u/dpannell/dpap987f.htm (44K)
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Using
Individual-Farm Models for Resource Conservation
Problems: Positives and Pitfalls. by Dave Pannell
"It has mistakenly been concluded by some that economic decision models at the individual-farm level have little or no contribution to make to evaluation of resource conservation issues." |
In September Dave
Pannell spoke on this topic to economists at NSW Agriculture,
Orange. He started with the observation that resource
conservation issues are widely held to be larger in scope than
individual farms. Partly as a consequence of this, there has been
an increasing emphasis on catchments and groups of farmers in
agricultural extension. For these reasons, it has mistakenly been
concluded by some that economic decision models at the
individual-farm level have little or no contribution to make to
evaluation of resource conservation issues. There are several
reasons why this is not true. (a) Notwithstanding the reality of
catchment processes (especially water-related) beyond farm
boundaries, and the undoubted value of group-based extension,
final decision making still rests with individual farmers. For
resource conservation practices, as for others, private financial
considerations are key drivers of management decisions.
Individual farm models provide useful information about economic
incentives facing farmers. (b) Even where the model is used to
provide direct support to decision makers who are concerned with
aggregate rather than individual effects, individual farm models
can contribute in a number of ways. These include providing
information about the costs of reducing land degradation, and the
likely responses of farmers to potential policies. (c) For
several major land conservation issues, the central concerns are
not with spillover effects, but with poor decision making due to
poor information. In these cases, individual farm models are
perfectly appropriate. (d) Even where externalities exist, they
do not necessarily lead to market failure. There are reasons why
the optimal farming strategy from a private farmer’s
perspective may still correspond to the socially optimal
strategy, and these reasons are likely to apply in practice, at
least in some cases. The various potential uses and contributions
of individual farm models are outlined and illustrated with
examples. However, it is important to recognise the broader
context within which individual farms sit and that this context
places limitations on the generality of results from
individual-farm models.
For the full article, see this web page: http://www.general.uwa.edu.au/u/dpannell/dpap9809f.htm (71K)
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Why
is Adoption of Sustainable Farm Practices Slow? by Dave Pannell
"The efficiency of Landcare could be improved substantially if efforts were made to identify these limits and operate within them." |
National Landcare
Coordinator, Lachlan Polkinghorne, organised a workshop in
Geelong, Victoria on "Profitable and Sustainable Farming
Systems" in July. He invited Dave Pannell to speak on the
subject of the "Adoption of sustainable
farming practices" article from SEA News #1.
This was Dave's starting point but he went further into the
question of why adoption of sustainable farm practices is often
slow or low. There is actually a range of factors that may
contribute to the problem in particular situations, including: a
lack of profitable options, negative spillover affects from one
farmer to another ("externalities"), high
"transaction costs" involved in negotiations between
farmers and non-farmers or among farmers, uncertainty about the
available farming options, the great difficulty and low value of
conducting small-scale trials to test some of the options. Then
addressing the question of how Landcare extension can best
contribute, Dave argues that there are limits to the
circumstances where extension can be effective, and that the
efficiency of Landcare could be improved substantially if efforts
were made to identify these limits and operate within them.
Outside these limits, other approaches such as R&D or
regulation may be used alone, or they may help to change the
nature of the adoption problem such that extension can become
effective. Of the factors in the last section, extension appears
to have a very limited potential to reduce the problems of lack
of profitable options, externalities and long time scales. This
is not a criticism of Landcare, just a recognition that different
tools have different uses. Landcare should therefore focus on:
identifying winners (from the farmer's perspective), seeking
innovative ways to help farmers reduce uncertainty about their
options, raising awareness, promoting stewardship, helping
farmers develop their skills in new areas, and promoting
so-called "social capital" or "social
infrastructure".
For the full article, see this web page: http://www.general.uwa.edu.au/u/dpannell/dpap988f.htm (59K)
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Economics
of Crop/Tree Phase Farming for Dryland Salinity
Management. by Steven Schilizzi "The study suggests that it should pay for government to promote ‘green’ (that is, lower) interest rates on loans for rehabilitation investments." |
Together with Ute
Mueller and Tuyêt Tran of Edith Cowan University, I have been
investigating the economics of a novel strategy for managing
dryland salinity. The strategy involves rotating between phases
of cropping, during which salinity worsens, and phases of tree
plantations, during which the land is rehabilitated. The
geographical setting is the Western Australian wheatbelt. The
type of trees referred to are oil mallees, as presently being
researched by CALM. The problem is that crop yields and farm
profits fall over time as land goes saline, but that
rehabilitation with trees is less profitable in the short run
than cropping. Farmers must then balance out short term and long
term profits. The relative weighting given to short term versus
long term benefits is captured by discounting, which factors in
the farmer’s value of time. We investigate total farm
profits over a 100 year time span and the preferred duration of
cropping and rehabilitation phases. The outcomes are very
sensitive to farmers’ discount rates and to the rate at
which the watertable rises or falls. Though still preliminary,
the study suggests that it should pay for government to promote
‘green’ (that is, lower) interest rates on loans for
rehabilitation investments and to facilitate tree plantations by
farmers by increasing the value of trees through end-product and
market developments.
For the full article, see this web page: http://www.general.uwa.edu.au/u/dpannell/dpap9810f.htm (28K)
Policy Forum
We welcome reactions to articles in SEA News, or on topical relevant issues. Phil Price of Land and Water Resources Research and Development Corporation provided the following reactions to our first issue.
Comments on
sustainability, Landcare and regulation
The topics of sustainability, extension and the role of the landcare movement, etc., are mentioned several times in SEA News #1. I would like to suggest that we have not as a community yet really focused on the key issues in sustainability and sustainable agriculture, and that the landcare movement, while it has been very successful at raising awareness, also runs the risk of dealing with the symptoms rather than the causes of unsustainability. I would like to suggest further that all of the current agricultural systems in Australia, at least in the south of the country, are unsustainable in ecological terms and are not likely to ever be sustainable, no matter how much we fiddle around the edges. The central issue, as has been outlined by Ted Lefroy and others, is that current cropping and pasture systems are unable to make full use of rainfall over the year, and consequently leak water (and nutrients, salt, DOC etc) when compared with the natural ecosystems that they have replaced. This suggests that if our goal is ecological sustainability, we need to change our thinking in order to take the environment (and particularly its water availability) as a given, and to redesign plants and agricultural systems to fit in with the environment rather than the other way around. It also suggests that the current focus of landcare, for example on planting strips of trees to reduce salinity when the surrounding 100 ha paddock contains plants incapable of using the water available, is not likely to be effective in the long run.
The second item I wish to raise concerns the paper on "Adoption of Sustainable Farming Practices – Social and Economic Challenges". The newsletter summary lists four important challenges, but they seem to be based on an assumption that sustainable agriculture and changes in farming practice are purely voluntary. While there may be benefits in such a system, and it is probably the preferred route for most farmers, an examination of the context of agriculture in the northern hemisphere (and closer to home in the Murray-Darling Basin, for example) suggests that voluntary action will not be the sole, and perhaps not even the main, driver. In addition to farmers’ own needs and perceptions, farming practice will also be driven to some extent by the expectations of the Australian community that farmers will manage the nation’s natural resources in a sustainable manner, and by the requirements of processing industries and export markets for some way of assessing the environmental soundness of production systems and their products. If Australian agriculture moves along this track, then legislation and regulation governing the use and health of natural resources, together with industry-based environmental management systems, codes of practice, audits and so on, will provide an important part of the context within which individual farmers make their decisions.
For Phil Price's full comments and a brief response by Dave Pannell, see Web page: http://www.general.uwa.edu.au/u/dpannell/forum2.htm
Ideas and Lessons on Sustainability from Overseas
To help us think laterally about the problems we face in Australia, we include an example from overseas in each issue of SEA News. This article is courtesy of Michael Burton, recently appointed as Associate Professor in Agricultural and Resource Economics, University of Western Australia.
Adoption of Organic
Agriculture in Europe: Economic and Non-Economic Determinants
Many "alternative" approaches to agricultural production have been established in response to problems associated with conventional, intensive farming. What motivates producers to adopt these more sustainable techniques? This is the central focus of a study which has been recently completed by researchers based at the University of Manchester, UK. Using farm survey data specifically collected for this study in the UK, Spain and Brazil, we have investigated the economic and non-economic factors which determine horticultural producers’ choice of agricultural technology, with a specific focus on the decision to adopt organic techniques.
A key finding is that the timing of the decision to adopt organic farming methods is affected by different factors than the eventual level of adoption. For example, in the UK managers of smaller holdings are more likely to convert to organic practices, but farm size per se does not explain the timing of that decision.
The attitudes and opinions of the organic farmers in Spain and the UK were quite different from their conventional counterparts, while in Brazil these differences were minimal. In the UK and Spain attitudes and beliefs were found to be crucial, whilst in Brazil this was not the case. Only in the UK was gender significant, but here it exerted a powerful effect. The evidence points to non-economic factors having a primary role in the adoption decision in the European samples, but not in Brazil.
For the full article, see this web page: http://www.general.uwa.edu.au/u/dpannell/seaos2.htm
Regular Bits and Pieces
Overview of the SEA Project
This project has a strong integrative focus, bringing together several sustainability issues and considering their biological, physical and economic implications at the whole-farm level. The main issues being researched in the project are soil salinisation, soil acidification, management of herbicide-resistant weeds, farmer adoption of sustainable practices and the economics of monitoring sustainability indicators. Main funding: Grains Research & Development Corporation. Commencement: 01-Aug-97 Completion: 30-Jun-02
People in the SEA Team
Direct collaborators in Western Australia - Economists: Martin Chopping (Department of Environmental Protection), Gavin White (Campbell White and Associates), Simone Blennerhassett (Agriculture Western Australia), Amir Abadi, Anne Bennett (University of Western Australia), Vanessa Stewart (CLIMA). Bio-physical scientists: Don McFarlane, Bill Porter, Chris Gazey, David Bowran, Dan Carter and Rob Hetherington (Agriculture Western Australia), Steve Powles, David Jasper (University of Western Australia), Norm Campbell, Tom Hatton + team (CSIRO).
Publications available
As
well as the articles summarised in this Newsletter, the SEA
Project has a range of publications which we invite you to read.
A list is shown at the following web page address. You can view
and print many of the papers directly in your browser. For others
you are interested in, contact David Pannell to ask for a copy.
Web page:
http://www.general.uwa.edu.au/u/dpannell/seapprs.htm
We also have a page with papers that focus on agricultural extension, and adoption and diffusion of innovations in agriculture: Web page: http://www.general.uwa.edu.au/u/dpannell/adoppprs.htm
Other issues of SEA News
Copyright note: Some articles in SEA news have subsequently been submitted for publication in journals or books. SEA News contains pre-publication versions of these articles. They have not been subject to peer review, and copyright rests with the authors. When an article is formally published, the version on the SEA News web site is not updated to the published version, as this would violate copyright. However, the citation shown on the web page is updated to allow readers to identify the published version. Readers are encouraged to make use of the material present on the web site, provided that its source is acknowledged. Readers who wish to make direct quotes from an article in SEA News should not attribute the quote to a more formal (e.g. journal) published version of the paper without checking the published version, since the quote may have been alterred or even omitted from the published version.
If you have any comments about SEA News or wish to make additions or deletions to our mailing list, contact David.Pannell@uwa.edu.au
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