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Behavioral Economics
*


    Food Production and Distribution
       from an Island Perspective
[T]aíno were agricultural
                           people…cassava, squash, sweet potatoes and other
                           tubers, such as yautía…maize, beans…[they] grew
                           their root crops in artificial mounds of loose earth
                           called conucos…mamey, papaya and
                           pineapples…achiote, tobacco and
                           cotton…supplemented diet by hunting and fishing
                           (turtles, manatees, fish, birds, oysters)– An
Pre Columbian              Introduction to Taino Culture and History, Ricardo
Period:                    Alegría
Arawak
People, Island
Hopped from
Venezuela to the
Northern Caribbean
basin and brought
cultigens from
northern South
America and other
Mesoamerican
people.
Researchers
indicate there is     “…[T]aíno needed to increase agricultural production
evidence of limited
commerce to the
                      in order to support a large population on a limited
mainland and the      amount of land”
Spanish Conquistadors brought large animal, fruits
                 (citrus, and vegetables known to Europeans. Early
                 on, along with the slave trade, bananas and
                 plantains, ginger, okra and other products known to Africa
                 were also brought to Puerto Rico. Later on
                 coffee, cacao, sugarcane and spices were introduced to
                 the Island. Turtles, Queen Conch and other seafood were
                 exploited for local sustainability.
Colonization
Period:
As new
cultivars and
domesticated
animals were
brought into
Puerto
Rico, trade
with Europe
increased as
sugar, coffee,
cacao and
tobacco were
shipped to
Spain and its
Territories.
In the early 1900’s new breeds of cattle and plants were
                   introduced by the US military. Food Technology Research
                   had a strong part in the 1940’s and 50’s. Massive projects
                   of Irrigation and drainage canals were built increasing total
                   arable land. Several Hurricanes devastated plantations.
                   Advent of Refrigeration allowed for perishables to move
                   across the Atlantic Ocean.

US Occupation:
New technology
and investment
allowed for an
increased trade
with the
northeast US.
Sugarcane and
Tobacco
dominated.
Coffee was still
exported to
Europe. High
production
allowed to
satisfy local
demand.
At present time, it is estimated that 80% of all food consumed
                       in PR comes from elsewhere. Agriculture and food processing
                       have not kept pace with population growth at home nor
                       abroad. In the 1950’s Puerto Rico departed from an agrarian
                       based economy to a manufacturing based one. Population
                       moved from Rural areas to the San Juan Metro Area looking for
                       better opportunities.

PR Today:
3.7 Million People
2.1 Million Acres
8% arable land
4% permanent crops
7.2% val. added mfg.
60% pop. on SNAP

Even though great
advances in
technology and
infrastructure have
taken place, exports
from Puerto Rico
have fallen
dramatically.
Mangoes and finished
foods are exported.
* “an integrated system of plant and animal
 production practices having a site-specific
 application that will, over the long term, satisfy
 human food and fiber needs; enhance
 environmental quality and the natural resource
 base upon which the agricultural economy depends;
 make the most efficient use of nonrenewable
 resources and on-farm resources and
 integrate, where appropriate, natural biological
 cycles and controls; sustain the economic viability
 of farm operations; and enhance the quality of life
 for farmers and society as a whole.” Public Law
 101-624, Title XVI, Subtitle A, Section 1683 (1990)
 [Emphasis added]



                            *
* USDA’s Sustainable Agriculture Research and Education
 3 pillars:
  * Profit over the long term;
  * Stewardship of our nation’s land, air and water and;
  * Quality of life for farmers, ranchers and their
    communities.
* American Planning Association’s Sustainable Food
 Systems:
  * relationships between sectors (from production to
    waste disposal) and characteristics (health-
    promoting, sustainable, resilient, diverse, fair, econom
    ically balanced, and transparent) of the system.


                                   *
* Challenges pursuing sustainable agriculture in Puerto
 Rico:
  * High costs of production
    (labor, environmental, energy);
  * No vertical integration of the food cluster (lack of
    trust among players, inadequate government
    intervention);
  * Lack of conservationist and entrepreneurial culture
    (isolationism, subsidy dependency, complex
    management).
* The benefits, both here and elsewhere, are
 unquestionable although a unique recipe needs to be
 adopted case by case.


                                  *
* In order to achieve a sustainable food system, the
 first building block to overcome the challenges we
 face in Puerto Rico, is entrepreneurship.
* In the words of Jim Collins (From Good to
 Great), “First Who, Then What”. Who’s engaging in
 food related activities?
  * Ethical, Disciplined, Intellectual, Thorough, Innovat
    ive People
* What needs to be in place in order to promote
 entrepreneurialism?


                 *
* Dan Isenberg, Babson College, promoted during the Puerto
 Rico Entrepreneurship Ecosystem Project 13 elements that
 must be in place in order to achieve economic
 development:
  * leadership;
  * Government as facilitator;
  * culture;
  * entrepreneur success stories;
  * the availability of human capital in terms of skilled and
    unskilled;
  * Financial capital;
  * non-government organizations (NGOs) that are working to
    support entrepreneurship;




                        *
* educational institutions;
* infrastructure;
* the presence of economic clusters;
* the availability of networks that can be made up of the
    diaspora, entrepreneurs and multinational corporations;
* support services in terms of the availability of good
    legal and accounting firms and investment bankers;
*    and early customers who are available to support a
    company’s products and services.




                      *
* The scope of Government in recent years has been
 that of promoting “agripreneurs” through:
  * Agribusiness coursework for farmers through SBTDC’s
   and UPR programs as pre condition to incentives;
  * Creating “High Yield, High Quality” models;
  * Investing in applied research to solve issues pertaining
   tropical agriculture;
  * Providing incentives for renewable energy
   infrastructure;
  * Assisting to organize a Food Cluster;
  * Reaching out to consumers through Market Farmers and
   Media Campaigns to Buy Local.


                     *
* Puerto Rico has gone from subsistence agriculture, to
  agri industry (late 1800’s and early 1900’s), agrarian
  reform (1940’s), centralized planning (early
  60’s), government as producer (1970’s), subsidized
  agriculture (1980’s), to a somewhat market driven
  agriculture (1990’s), to an attempt of coop model in
  the early 2000’s along with all of the preceding.
* Most recently, an effort to achieve a truly market
  economy driven agriculture has taken place, this time
  with a twist as we considered the “social, congnitive
  and emotional factors on economic decisions (both
  individuals and organizations) and the consequences
  for market prices, returns and resource allocation” as
  the new trend of economics is defined.




         *
Emerging Opportunities
  Commerce to mainland
  cities with high Puerto           Canada
     Rican population.

                                      Smart
 Institutional    Guys with big
                                  Engagement at
Markets (School    trucks who
                                       the
   Districts)     dare to cook!
                                   supermarket



       *
* Farmers Market
  * Mercado Urbano
    * Urban Farmers’ Market in affluent area of San Juan
      with several editions across the island.
  * Placita en Plaza
    * Farmers’ Market inside Caribbean’s largest Shopping
      Mall.
  * Harvest of Puerto Rico
    * Seal of Quality and Media Campaign


     *
*
* Risk: The Politics of Fear, by Dan Gardner.
* An old trend is lurking around these days: FEAR.
  * shortage on food supplies, climate change, food recalls, epidemics.
  * Particular responses are expected from these potential threats.
  * For Puerto Rico, in the 1930’s having 100% of food produced on the island
    meant a threat on food security because of hurricanes. The solution:
    Imports.
  * Also, around that time, the US faced a very limited purchasing power of
    the American people. The Solution: Welfare.
  * During the Cold War Era the threat was a nuclear attack and food
    availability in shelters over long periods: The Solution: Canned Food.
  * Nowadays, here we face the concern of a disabling earthquake that may
    prevent ships from docking and hence cut the chain of supply. The
    Solution: Produce 100% of food locally until the next hurricane hits!
  * While crises occurs, what? The best way to avoid crises is taking care
    of opportunities.




               *

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FDRA

  • 1. Behavioral Economics * Food Production and Distribution from an Island Perspective
  • 2. [T]aíno were agricultural people…cassava, squash, sweet potatoes and other tubers, such as yautía…maize, beans…[they] grew their root crops in artificial mounds of loose earth called conucos…mamey, papaya and pineapples…achiote, tobacco and cotton…supplemented diet by hunting and fishing (turtles, manatees, fish, birds, oysters)– An Pre Columbian Introduction to Taino Culture and History, Ricardo Period: Alegría Arawak People, Island Hopped from Venezuela to the Northern Caribbean basin and brought cultigens from northern South America and other Mesoamerican people. Researchers indicate there is “…[T]aíno needed to increase agricultural production evidence of limited commerce to the in order to support a large population on a limited mainland and the amount of land”
  • 3. Spanish Conquistadors brought large animal, fruits (citrus, and vegetables known to Europeans. Early on, along with the slave trade, bananas and plantains, ginger, okra and other products known to Africa were also brought to Puerto Rico. Later on coffee, cacao, sugarcane and spices were introduced to the Island. Turtles, Queen Conch and other seafood were exploited for local sustainability. Colonization Period: As new cultivars and domesticated animals were brought into Puerto Rico, trade with Europe increased as sugar, coffee, cacao and tobacco were shipped to Spain and its Territories.
  • 4. In the early 1900’s new breeds of cattle and plants were introduced by the US military. Food Technology Research had a strong part in the 1940’s and 50’s. Massive projects of Irrigation and drainage canals were built increasing total arable land. Several Hurricanes devastated plantations. Advent of Refrigeration allowed for perishables to move across the Atlantic Ocean. US Occupation: New technology and investment allowed for an increased trade with the northeast US. Sugarcane and Tobacco dominated. Coffee was still exported to Europe. High production allowed to satisfy local demand.
  • 5. At present time, it is estimated that 80% of all food consumed in PR comes from elsewhere. Agriculture and food processing have not kept pace with population growth at home nor abroad. In the 1950’s Puerto Rico departed from an agrarian based economy to a manufacturing based one. Population moved from Rural areas to the San Juan Metro Area looking for better opportunities. PR Today: 3.7 Million People 2.1 Million Acres 8% arable land 4% permanent crops 7.2% val. added mfg. 60% pop. on SNAP Even though great advances in technology and infrastructure have taken place, exports from Puerto Rico have fallen dramatically. Mangoes and finished foods are exported.
  • 6. * “an integrated system of plant and animal production practices having a site-specific application that will, over the long term, satisfy human food and fiber needs; enhance environmental quality and the natural resource base upon which the agricultural economy depends; make the most efficient use of nonrenewable resources and on-farm resources and integrate, where appropriate, natural biological cycles and controls; sustain the economic viability of farm operations; and enhance the quality of life for farmers and society as a whole.” Public Law 101-624, Title XVI, Subtitle A, Section 1683 (1990) [Emphasis added] *
  • 7. * USDA’s Sustainable Agriculture Research and Education 3 pillars: * Profit over the long term; * Stewardship of our nation’s land, air and water and; * Quality of life for farmers, ranchers and their communities. * American Planning Association’s Sustainable Food Systems: * relationships between sectors (from production to waste disposal) and characteristics (health- promoting, sustainable, resilient, diverse, fair, econom ically balanced, and transparent) of the system. *
  • 8. * Challenges pursuing sustainable agriculture in Puerto Rico: * High costs of production (labor, environmental, energy); * No vertical integration of the food cluster (lack of trust among players, inadequate government intervention); * Lack of conservationist and entrepreneurial culture (isolationism, subsidy dependency, complex management). * The benefits, both here and elsewhere, are unquestionable although a unique recipe needs to be adopted case by case. *
  • 9. * In order to achieve a sustainable food system, the first building block to overcome the challenges we face in Puerto Rico, is entrepreneurship. * In the words of Jim Collins (From Good to Great), “First Who, Then What”. Who’s engaging in food related activities? * Ethical, Disciplined, Intellectual, Thorough, Innovat ive People * What needs to be in place in order to promote entrepreneurialism? *
  • 10. * Dan Isenberg, Babson College, promoted during the Puerto Rico Entrepreneurship Ecosystem Project 13 elements that must be in place in order to achieve economic development: * leadership; * Government as facilitator; * culture; * entrepreneur success stories; * the availability of human capital in terms of skilled and unskilled; * Financial capital; * non-government organizations (NGOs) that are working to support entrepreneurship; *
  • 11. * educational institutions; * infrastructure; * the presence of economic clusters; * the availability of networks that can be made up of the diaspora, entrepreneurs and multinational corporations; * support services in terms of the availability of good legal and accounting firms and investment bankers; * and early customers who are available to support a company’s products and services. *
  • 12. * The scope of Government in recent years has been that of promoting “agripreneurs” through: * Agribusiness coursework for farmers through SBTDC’s and UPR programs as pre condition to incentives; * Creating “High Yield, High Quality” models; * Investing in applied research to solve issues pertaining tropical agriculture; * Providing incentives for renewable energy infrastructure; * Assisting to organize a Food Cluster; * Reaching out to consumers through Market Farmers and Media Campaigns to Buy Local. *
  • 13. * Puerto Rico has gone from subsistence agriculture, to agri industry (late 1800’s and early 1900’s), agrarian reform (1940’s), centralized planning (early 60’s), government as producer (1970’s), subsidized agriculture (1980’s), to a somewhat market driven agriculture (1990’s), to an attempt of coop model in the early 2000’s along with all of the preceding. * Most recently, an effort to achieve a truly market economy driven agriculture has taken place, this time with a twist as we considered the “social, congnitive and emotional factors on economic decisions (both individuals and organizations) and the consequences for market prices, returns and resource allocation” as the new trend of economics is defined. *
  • 14. Emerging Opportunities Commerce to mainland cities with high Puerto Canada Rican population. Smart Institutional Guys with big Engagement at Markets (School trucks who the Districts) dare to cook! supermarket *
  • 15. * Farmers Market * Mercado Urbano * Urban Farmers’ Market in affluent area of San Juan with several editions across the island. * Placita en Plaza * Farmers’ Market inside Caribbean’s largest Shopping Mall. * Harvest of Puerto Rico * Seal of Quality and Media Campaign *
  • 16. *
  • 17. * Risk: The Politics of Fear, by Dan Gardner. * An old trend is lurking around these days: FEAR. * shortage on food supplies, climate change, food recalls, epidemics. * Particular responses are expected from these potential threats. * For Puerto Rico, in the 1930’s having 100% of food produced on the island meant a threat on food security because of hurricanes. The solution: Imports. * Also, around that time, the US faced a very limited purchasing power of the American people. The Solution: Welfare. * During the Cold War Era the threat was a nuclear attack and food availability in shelters over long periods: The Solution: Canned Food. * Nowadays, here we face the concern of a disabling earthquake that may prevent ships from docking and hence cut the chain of supply. The Solution: Produce 100% of food locally until the next hurricane hits! * While crises occurs, what? The best way to avoid crises is taking care of opportunities. *