Productivity growth in world agriculture


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Productivity growth in world agriculture

  1. 1. ProductivityGrowth InWorldAgricultureSources And Constraints
  2. 2. Group Members Waqas Siddique Sameer Tariq Tamour Irshad Shoib Samdani
  3. 3. Introduction Before 20th century, increases in crops and animal production through enlarging the area cultivated. By the end of century, all increases were coming from increasing land productivity. Transition of developed, developing and poorest countries. Population increase, cause the demand to double in 2050, so there would be high income elasticity for food. Most difficult challenges as population and income continue to grow rapidly (By 2050, 9 and 10 billion).
  4. 4. Introduction Most growth is expected to occur in poor countries where income elasticity for food remains high. Population growth will slow substantially in countries like India and China, and demand for food will decrease as income rises, so income elasticity for food declines. To keep pace, particularly the world’s poorest countries require increase in scientific and technical effort.
  5. 5. Agriculture In Development Thought Agriculture sector was viewed as a sector for extracting resources and funding the industrial sector. But was never thought of how to improve it. By early 1960s, it became clear that the agriculture technology is location specific. W. Schultz in his book “Transforming Traditional Agriculture” insists that if the agrarian societies are given modern counterparts they too could succeed. They are “poor but efficient”.
  6. 6. Agriculture In Development Thought For agricultural sector development high payoff investments are:1) Capacity of agricultural research institutions togenerate new location specific technical knowledge.2) Capacity of technology of supply industries todevelop, produce, and market new technical inputs.3) Schooling and non-formal education of rural peopleto enable them use the knowledge and technologyeffectively.
  7. 7. Agriculture In Development Thought “High pay-off input model” was not able to explain two major points:1) How economic conditions induce an efficientpath of technical change for the agricultural sectorof particular society.2) How economic conditions induce thedevelopment of new institutions.
  8. 8. Agriculture In Development Thought Early 1970s, Hayami and Ruttan formulated a model of induced technical change. In this model the direction of technical change in agriculture was induced by changes in relative resource endowments and factor prices. (Substitution of expensive factors with cheap ones.) Two kinds of technology are:1) Mechanical Technology2) Biological and Chemical Technology
  9. 9. Agriculture In Development Thought
  10. 10. Agriculture In Development Thought A fully mechanized agriculture is typically very capital intensive. Biological advances involves:1) Water and resource development to provide a morefavorable environment for plant growth.2) Addition of organic and inorganic sources of plantnutrition to soil.3) Breeding of new biologically efficient crop varieties.
  11. 11. Agriculture In Development Thought The implications of this model are: 1) In labor-abundant and land-constrained developing countries like, China and India, research resources are most productively directed to advancing yield enhancing biological technology. 2) Land-abundant Brazil has realized very high returns from research directed to releasing the productivity constraints on its problem soil. Heavy lime application on acidic aluminum soil has open region to extensive mechanized production of maize and soya beans.
  12. 12. Measuring The Rate And Direction Of Productivity Growth Three stages of comparative research on rate and direction of productivity:1. Inter-country cross section and time-series comparisons of output perunit of land and labor. The several country and regional growth paths fall broadly into three groups:A) Land-constrained path in which output per hectare has risen fasterthan output per worker.B) Land abundant path in which output per worker has risen more rapidlythan output per hectare.C) Intermediate growth path in which output per worker and perhectare have grown at somewhat comparable rates.
  13. 13. Measuring The Rate And Direction Of Productivity Growth
  14. 14. Measuring The Rate And Direction Of Productivity Growth 2) It involves the estimation of cross-country production functions and the construction of multifactor productivity estimates. Factor inputs – land, labor, livestock, capital equipment (machinery) and current inputs (fertilizer). Result; land and livestock, machinery and fertilizer, general and technical education each accounted for 1/4th of differences in labor productivity between developed and less developed countries as groups. Scale economies account for 15% of the difference.
  15. 15. Measuring The Rate And Direction Of Productivity Growth This implies that:A) Labor productivity in less developed countries isencouraging.B) Pressure of population against land resourceswas not a binding constraint.C) Scale diseconomies were not immediateconstraint.
  16. 16. Measuring The Rate And Direction Of Productivity Growth3) Convergence of growth rates and levels of multifactor productivity between and among developingand less developed countries. The frontier productivity approach have been employed (To construct the best practice and measure the distance of each country in sample from the frontier by linear programming method. Widening of agricultural productivity gap between developed and developing countries between the early 1960s and 1990s. Developed countries converge at the same point other than northern and southern Europe(diverge).
  17. 17. Measuring The Rate And Direction Of Productivity Growth
  18. 18. Measuring The Rate And Direction Of Productivity Growth This concludes that: Technical change in Asia has been strongly biased in a land saving direction in response to severe constraints in land resources. Thisbias is reflected in both a land saving shift in the production function and the substitution of technical inputs, particularly fertilizer and pest and pathogen control chemicals, for land.
  19. 19. Resources And Environmental Constraints Leading resources and environmental constraints faced by farmers includes: Soil loss and degradation Water logging and Salinity of soil Coevolution of pests, pathogens and hosts Impact of climate change
  20. 20. Resources And Environmental Constraints Soil: By 2050 it may be necessary to feed “twice as many people with half as much topsoil”. Natural Resources Conservation Service have been interpreted to indicate that if 1992 erosion rates continued for 100 years the yield loss at the end of the period would amount to 2-3%. Study in China; very little loss of organic matter, can overcome nitrogen loss by use of fertilizer. Not a serious constraint on agriculture production over next half century. But is a serious constraint in areas with fragile resource areas like arid and semiarid regions of sub-Saharan Africa.
  21. 21. Resources And Environmental Constraints Water: Last half century, water has become a resource of high and increasing value in many countries. In arid and semi arid regions water scarcity is becoming a serious constraint. International Water Management Institute has projected that by 2025 most countries including China would face severe water scarcity. Irrigation systems can be the answer to the water scarcity. Lack of water resources is unlikely to become a severe constraint on global agriculture production.
  22. 22. Resources And Environmental Constraints Pests: Pests has become an increasingly serious constraint. US, pesticides have been the most rapidly growing input over last half century. Dichlorodiphenyl-trichloroethane (DDT) effective against almost all insect species and relatively harmless to human, animals and plants. One cost was that it was somewhat harmful to wildlife and humans and other cost is that it was involved in destruction of beneficial insects.
  23. 23. Resources And Environmental Constraints Pests: The integrated pest management involved the use of an array of pest control strategies. They started many programs for pest control. The pests are evolving into more resistant pests because of the use of different technologies. So they must be updated.
  24. 24. Resources And Environmental Constraints Climate: Measurements taken in Hawaii in late 1950s indicate that CO2 was increasing in atmosphere. Changes in temperature and precipitation could occur because of human induced Co2 and green house gases. By, 2050 Co2 will be doubled. Rise in temperature from 2.5oC – 4.5oC
  25. 25. Resources And Environmental Constraints Climate: The atmospheric concentration of greenhouse gases could affect agricultural production through three elements: 1) Higher Co2 concentration in atmosphere may have positive “fertilizer effect” on some crop plants. 2) Higher level could result in sea level and intrusion of saltwater into ground water aquifers. 3) Changes in temperature, rainfall and sunlight may also alter agricultural production.
  26. 26. Scientific And Technical Constraints Technical change in agriculture is endogenous, scientific and technical resources will be directed to sustaining or enhancing the productivity of those factors that are relatively scarce and expensive. Farmers of those areas which have not acquired the capacity to invent or adapt technology to their resource endowments will find it difficult to respond to the growth of domestic and international demand. Advances in crop production would come from expansions in area irrigated. Advances in animal production would come from genetic improvements and advances in animal nutrition. Increases in crop yield would come from change plant architecture to make possible higher plant population per hectare.
  27. 27. Scientific And Technical Constraints The ratio of grain to straw is already high in many crops and increasing more would result in physiological constraints. There are also physiological constraints in improving animal feed in areas that have already achieved the highest level of output per hectare. Costs of scientist are rising faster than the general price level. The conclusion is that those countries that have achieved the highest levels of agricultural productivity have begun to experience diminishing returns.
  28. 28. Agricultural Research Systems The institutional arrangements for the support of agricultural research began in the middle of 19th century. In 1843 John Bennet established an agricultural experiment station on his family estate. Led to establishment of first publicly supported agricultural experiment station at Mockern, Saxony, 1852. The progress was made in 1st several decades of 20th century initiating public sector agricultural research capacity in Latin America. Researched was focused on tropical export crops such as sugar, rubber, cotton, bananas, coffee and tea. By 1960s substantial resources were channeled to strengthen agriculture education with focus on domestic food crops in developing countries.
  29. 29. Agricultural Research SystemsA number of bilateral donor agencies formed Consultative Group on International Agricultural Research (CGIAR). An active agricultural research system will be needed to sustain growth in agricultural productivity in 20th century. The research systems in most developing countries have yet to establish sufficient capacity to make effective use of existing advances in knowledge and technology.
  30. 30. Questions ?
  31. 31. Thank You