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Issue 15, March 2004
In This Issue
Editorial
In brief
* Commonwealth EMS guidelines * Productivity Commission draft report on land clearing restrictions * Sustainable rangelands * 48th Annual AARES Conference * Australian Lands * W.E. Wood Award
Articles
* Effectively communicating economics to policy makers (part 2)
* Comparing profitability and cashflows of agroforestry and agriculture on Australian farms
* Flat-earth economics: The far-reaching consequences of flat payoff functions in economic decision making
* Economics and policy for biological introduction decisions: Plant based solutions to dryland salinity
Coming events
Regular items
* Overview of the Economic and Social Assessment Subprogram of the CRC
Welcome to 2004 and issue 15 of SEA News. Many thanks to so many of you who contacted us with favourable feedback about our previous issue, which restored SEA News to cyber space! We hope you enjoy this issue as much as the last one.
This issue contains four articles, including the second part to David Pannell’s keynote address to the 47th AARES conference in 2003, entitled "Effectively communicating economics to policy makers", the first part of which appeared in Issue 14. The others papers featured are two from the 2004 AARES conference, including one from David Pannell on flat payoff functions and Cheryl Kalisch Gordon's paper on the economics of biological introductions, and a paper presented by Amir Abadi at the 2003 International Farm Management Congress on economics of agroforestry options.
We aim to produce our next edition of SEA News in May. If you have any news or views, or would like to submit an article, please contact either of us at seanews@agric.wa.gov.au.
Felicity Flugge and Robyn Hean
Commonwealth Environmental Management Systems guidelines
The Australian Government recently launched a new
program, "Pathways to Industry EMS", offering to work as a
partner with interested industries to develop and implement EMS and other
environmental assurance approaches to achieve three key outcomes:
• The adoption of profitable and sustainable farming practices
• Improved natural resource management and environmental outcomes
• An ability to demonstrate environmental stewardship to domestic and
international markets.
For more detail go to AFFA’s EMS webpage at :
http://www.affa.gov.au/content/output.cfm?ObjectID=54B97FAD-550D-4E3A-A211DB623F42891E
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Sustainable rangeland industries
A report on making rangeland pastoral industries more ecologically sustainable is now available from RIRDC. A focus for this project was the growing world-wide consumer interest in ‘environment-friendly’ food and fibre and the role this may play in rewarding good environmental performance in agriculture. Read about the project at http://www.rirdc.gov.au/reports/Ras/03-130-1sum.html.
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Commission attacks land clearing restrictions
The Productivity Commission has released a draft report of its public inquiry into the impacts of native vegetation and biodiversity regulations. The draft report has found the restrictions impose significant costs and hardship on farmers, by preventing efficient farming practices, and in some cases reducing property values. Commissioner Neil Byron says the blanket restrictions also fail to take into account local and regional differences, and give farmers no incentive to preserve native vegetation. You can find the 574 page report at: http://www.pc.gov.au/inquiry/nativevegetation/draftreport/index.html
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2004 AARES Conference
The 48th Annual Conference of the Australian Agricultural and Resource Economics Society was held in Melbourne during February. The conference featured a number of papers pertinent to our theme of Sustainability and Economics in Agriculture. Some of these papers will be featured in coming issues of SEA News, so stay tuned!
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Australian Lands – Land Degradation Forum
The Australian Lands – Land Degradation Forum was set up by the Australian Salinity Action Network (ASAN) to provide for the discussion of ways that we can deal with the serious problems created by land degradation in all its forms. ASAN hopes that through this forum and the communication it provides, it can assist in the process of finding solutions and lessening the impact that salinity, sodicity, acidity, erosion and other land destroying processes are having on our communities and our country.
To join send a blank email to australianlands-subscribe@yahoogroups.com. Or you can visit the Australian Lands webpage at http://groups.yahoo.com/group/australianlands. To contact the forum moderator please email - australianlands-owner@yahoogroups.com
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W.E. Wood Award
Nominations for the fifth W.E. Wood Award , Australia 's most prestigious award for excellence in salinity research and development, close on Friday, 2 April 2004.
Australia 's National Dryland Salinity Program (NDSP) sponsors this award for outstanding scientific or technical excellence, which recognises a unique contribution to managing salinity over a sustained period of many years. Consideration is also given to applied, innovative technical and social responses to the salinity challenge. The W.E. Wood Award is open nationally to individuals and will be judged on scientific content, innovation and social implications and the potential for being of lasting significance to Australia .
Further information is available from: http://www.ndsp.gov.au/we_wood_award/we_wood_award.htm
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Effectively communicating economics to policy makers (part 2) by David Pannell "The process of policy choice involves information, uncertainty, persuasion, disagreement, and networks of disparate individuals and groups" |
Many economists are concerned with communicating the results of economic analysis or the implications of economic theory to policy makers. Our effectiveness in doing this varies widely for different individuals and different issues. This paper is an attempt to provide practical advice to enhance this effectiveness. It considers policy "adoption" in the light of literature about the adoption of innovations by farmers and evidence from social psychology about factors that enhance persuasiveness in communication. A small survey of policy makers and policy advisors was conducted. Results provide a number of practical tips and insights.
This is the second part of this paper; Part 2 (29KB). The complete paper is available in the authors index.
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Comparing profitability and cashflows of agroforestry and agriculture on Australian farms by Amir Abadi "The most attractive projects are where initial costs of establishment can be offset through a share farming or alley farming system" |
This paper is a summary of a project that compared the relative profitability of existing, emerging and prospective agroforestry systems with profitability of conventional agricultural land uses in the cropping zones of Western Australia and New South Wales. The project explored the economic boundary conditions under which several promising agroforestry systems may be viable in the lower rainfall zones.
Partial budgeting and discounted cash flow techniques were used to conduct the comparative analysis of alternative land use scenarios. The profitability, cash flows and debt associated with each of the scenario are reported. The analysis underpinning this research provides estimates of the economic value of the temporal and spatial interaction effects of trees on agricultural crops and pastures. The paper is available here (59KB).
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Flat-earth economics: The far-reaching consequences of flat payoff functions in economic decision making by David Pannell "A key question modellers should ask themselves about information they generate for decision support is, what difference will it make to payoffs?" |
Economists tend to emphasise the optimum. For example, they ask questions such as, at what input level will expected profit or utility be maximised? However, the same empirical models used to identify the optimum also often tell us that even quite large deviations from optimal decisions may make little absolute difference to the expected payoff. This has far-reaching implications that are under-recognised. This paper reviews some of the implications related to agriculture. Key conclusions flowing directly from flat payoff functions are highlighted. The full paper is available here (203KB).
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Economics and policy for biological introduction decisions: Plant based solutions to dryland salinity by Cheryl Kalisch Gordon "An economic perspective [of what constitutes a weed] challenges the use of the precautionary principle and presents an opportunity for plants to be introduced on the basis of positive contributions to economic welfare." |
Assessment of the desirability of biological introductions must include the possibility that a species may have adverse impacts on the environment to which it is introduced. In the case of new plants this must include the possibility that the plant becomes a weed. The precautionary principle has driven assessments of the desirability of potential plant introductions. From an economic perspective a plant would be considered a weed when the costs associated with the introduced plant exceed the benefits derived from the introduced plant. This necessarily includes consideration of costs associated with negative externalities and benefits associated with positive externalities. An economic perspective therefore challenges the use of the precautionary principle and presents the opportunity for plants to be introduced on the basis of positive contributions to economic welfare. In the specific case of plants introduced to alleviate rising water tables associated with salinisation, the distribution of costs and benefits is likely to be particularly disparate.
Economic and policy issues associated with the size, uncertainty and distribution of costs and benefits related to biological introductions are explored in this paper. The full paper is available here (80KB).
Salinity Solutions: Working with Science and Community is a
national conference being convened by the CRC for Plant-based Management of
Dryland Salinity in conjunction with the Victorian Departments of Primary
Industries, and Sustainability and Environment. The conference will take
place in Bendigo, Victoria on the 2nd-5th of August 2004. More details can
be found on the conference website:
http://www.cdesign.com.au/salinity2004/index.htm
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The 4th International Crop Science Congress in
conjunction
with the 12th Australian Agronomy conference and the 5th Asian Crop Science
Congress is being held at the Brisbane Convention and Exhibition Centre,
Queensland, Australia from the 26th September to 1 October 2004. More
details at:
http://www.cropscience2004.com/
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The Asia-Pacific Productivity Conference 2004 (APPC2004)
will be held at he University of Queensland, Brisbane from July 14-16 2004.
More information can be found at the conference website:
http://www.uq.edu.au/economics/appc2004/
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SEA News is a newsletter on bioeconomic and social research on Sustainability and Economics in Agriculture. SEA News contains unpublished and working papers which focus on a wide range of sustainability and economic issues for agriculture. Issues covered include salinity, market-based instruments, adoption of innovations, greenhouse, ethics, policy and more. Through SEA News, we hope to introduce you to a large and diverse area of research which might otherwise escape your notice.
Overview of the Economic and Social Assessment Subprogram of the CRC
The Economic and Social Assessment subprogram of the CRC for Plant-based Management of Dryland Salinity aims to provide economic and social assessment of actual or potential plant-based systems for management of dryland salinity and of policies intended to promote salinity management. Research involves computer modelling, surveys, experimental economics, and analysis of a range of economic, social and bio-physical data. More information about the projects of the subprogram can be found on the CRC website: http://www1.crcsalinity.com/pages/program05.asp.
A full list of articles featured in this and previous issues of SEA News as well as articles not featured can be found using either the topic index or author index.
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 altered or even omitted from the published version.
© Copyright CRC for Plant-based Management of Dryland Salinity 2003