Jock R. Anderson

Using Time-Series and Cross-Section Data to Estimate a Production Function with Positive and Negative Marginal Risks

Abstract Two production-function models with error components for time and firms and a heteroscedastic disturbance are proposed. Unlike previous models, these two permit the variance of output to increase or decrease as one of the inputs is increased. When the models and some suggested estimators are applied to the pastoral zone of eastern Australia, the results indicate that labor, water, and possibly fencing, are likely to reduce the variance of wool production; and that sheep, and buildings and land, are likely to increase the variance.

Risk in rural development: challenges for managers and policy makers

Abstract Most poor people presently reside in rural areas. The rural poor are exposed to many risks while often lacking instruments to manage them adequately, and so are highly vulnerable. Providing appropriate risk-management instruments and supporting the critically vulnerable is thus one key pillar in an effective and sustainable rural poverty-reduction strategy. Such provision better allows the able-bodied to engage in high risk/higher return activities and thus with good fortune to move out of poverty. A framework must, to be adequate, involve multiple strategies (prevention, mitigation, coping) and arrangements (informal, market-based, public) for dealing with risk, and instruments that take account of the sources and characteristics of rural risk. These themes are reviewed from the perspectives of rural people as managers, and of policy makers who should be setting the conditions to make the lives of the poor easier and to help them escape from poverty.

The Rise and Fall of Training and Visit Extension: An Asian Mini-Drama With an African Epilogue

The paper reviews the origins and evolution of the Training and Visit (T&V) extension system, which was promoted by the World Bank in 1975-98 in over 50 developing countries. The discussion seeks to clarify the context within which the approach was implemented, and to analyze the causes for its lack of sustainability and its ultimate abandonment. The paper identifies some of the challenges faced by the T&V approach as being typical of a large public extension system, where issues of scale, interaction with the agricultural research systems, inability to attribute benefits, weak accountability, and lack of political support tend to lead to incentive problems among staff and managers of extension, and limited budgetary resources. The different incentives and outlook of domestic stakeholders and external donor agencies are also reviewed. The main cause of the T&V systems disappearance is attributed to the incompatibility of its high recurrent costs with the limited budgets available domestically, leading to fiscal unsustainability. The paper concludes with some lessons that apply to donor-driven public extension initiatives, and more generally to rural development fads. The role of timely, independent, and rigorous evaluative studies is specifically highlighted.

Allocative Efficiency, Traditional Agriculture, and Risk

A decision theory approach is presented for the assessment of allocative efficiency from cross-section production function estimates. Reappraisal of some of the evidence previously adduced gives only mixed support to the hypothesis of profit-maximizing behavior by farmers in traditional agricultures. It is suggested that scope remains for investigation of the alternative hypothesis of utility maximization which, unlike profit maximization, explicitly allows for subjective risk considerations and might therefore provide a more realistic basis for policies aimed at the modernization of traditional agricultures.

Promises and realities of community-based agricultural extension

In view of the market failures and the state failures inherent in providing agricultural extension, community-based approaches, which involve farmers‘ groups, have gained increasing importance in recent years as a third way to provide this service. The paper discusses the conceptual underpinnings of community-based extension approaches, highlights theoretical and practical challenges inherent in their design, and assesses the evidence available so far on their performance. The paper reviews both quantitative and qualitative studies, focusing on three examples that contain important elements of community-based extension: the National Agricultural Advisory Services program of Uganda, the agricultural technology management agency model of India, and the farmer field school approach. The review finds that in the rather few cases where performance has been relatively carefully studied, elite capture was identified as a major constraint. Other challenges that empirical studies found include a limited availability of competent service providers, deep-seated cultural attitudes that prevent an effective empowerment of farmers, and difficulties in implementing farmers‘ control of service providers‘ contracts. The paper concludes that, just as for the state and the market, communities can also fail in extension delivery. Hence, the challenge for innovative approaches in agricultural extension is to identify systems that use the potential of the state, the market, and communities to create checks and balances to overcome the failures inherent in all of them.

Choice of Varieties by Sri Lanka Rice Farmers: Comparing Alternative Decision Models

Sri Lanka rice farmers are faced with a choice between traditional and high-yielding rice varieties. Three risky-choice models are compared to explain producer behavior. Forty farmers with typically small rice areas were studied. Choice criteria compared were multiple (two)-attribute utility maximization, single (profit)-attribute utility maximization, and expected profit maximization. Expected utility maximization performed better than expected profit maximization: single-attribute utility maximization outperformed the more complex multiattribute utility model. The importance of careful elicitation of subjective probability distributions is emphasized. Rice farmers appear to allocate their land between available technologies in an economically rational way.

Sustaining growth in agriculture: A quantitative review of agricultural research investments

Growth in agriculture depends on many things but one of the most important is investment in agricultural research. Decision making in the agricultural research policy area can only be aided by access to better information. This article overviews a recent endeavor to move policy dialogue beyond merely qualitative impressions towards a process that is underpinned with new and cogent data. The data used have been assembled at ISNAR in a manner designed to make comparisons both over time and between countries more valid than has been the case in the past. The comparisons thus possible reveal considerable diversity both between countries and between broad regional aggregations. Also illuminated here are issues related to the commodity orientation, capital and labor intensity, and size and scope of particular national programs.

Sparse Data, Climatic Variability, and Yield Uncertainty in Response Analysis

A method based on smoothing sparse data is developed for assessment of risk in crop response processes when only few data are available. An empirical example illustrates how optimal inputs depend on degree of risk aversion when controlled inputs influence risk.

Selected policy issues in international agricultural research: On striving for international public goods in an era of donor fatigue☆

Abstract International agricultural research is a small but critically important part of the global research system. Its importance derives from the extent of international spillovers, the efficiencies of working across national boundaries for many research products, and the productivity-boosting collegiality and cost-reducing benefits thereof of sharing information and materials, while fostering the advance of agricultural science generally. Financial difficulties pervade the international as well as national elements of the global system, so it is an appropriate time to examine some of the threats to effective functioning of an international System that is needed for its key contributions to productivity growth. Suggestions are made for boosting efficiency of the international agricultural research centers and strengthening their support of national research efforts in the developing world.

Difficulties in African agricultural systems enhancement? Ten hypotheses

Abstract The agricultural systems of Sub-Saharan Africa are diverse and vast. Investment in public-sector agricultural research has been considerable, but advances in productivity have been patchy and disappointing. Several hypotheses are synthesized to seek to comprehend why ‘improved’ technologies have had such little impact in recent times. These variously relate to: profitability; risk; data relevance; research gestation, support and resource allocation; threatened natural resources; and economic infrastructure.