AGRICULTURAL ECONOMICS
INTRODUCTION
Agriculture
certainly is among the most prominent sectors of any economy. Psalm 104
illustrates this point: “Bless the lord, O my soul, thou dost cause the grass
to grow for the cattle, and plants for man to cultivate, that he may bring
forth food from the Earth.” Unequivocally, from biblical times agriculture has
been a discipline worthy of study. I am specifically interested in the economic
relationships inherent in the agricultural sector. The roots of agricultural
economics perhaps can be traced back to ancient Egypt, arguably to the first
agricultural economist, Joseph. Joseph interpreted the dreams of the Pharaoh of
Egypt and correctly predicted seven years of feast and seven years of famine.
However, this work is based on the meaning and scope of agricultural economics.
MEANING AND SCOPE OF AGRICULTURAL ECONOMICS
MEANING
Economics is the science of the administration of scarce resources
(land, labor, capital and management), which are needed in order to produce
goods and services that satisfy human wants. The field of agricultural
economics is delineated by the application of economic science tools to the
agricultural sector.
Thus, the meaning of Agricultural economics, which
refers to all economic activities connected with the control of living
organisms, such as plants and animals. These economic activities gravitate
around the production of food, and they involve many different economic actors
at different production and transformation stages.
However, since agricultural economics engrosses the application of
economics to agriculture, it can also be define as follows: Agricultural
economics is an applied social science that deals with how producers,
consumers, and societies use scarce and natural resources in the production,
processing, marketing, and consumption of food and fiber products.
Many authors has given the meaning of agricultural
economics in differs ways such as; Prof. Gray and Prof. Hubbard
PROF. GRAY DEFINITION OF AGRICULTURAL ECONOMICS
Prof. Gray care for agricultural economics as a division
of broad-spectrum subject of economics. It is only one of the many kindling of
applied economics. Such as Industrial Economics, Labour Economics, Monetary
Economics, Transport Economics, Public Economics, International Economics,
Household Economics, etc.
Consequently according to Prof. Gray, agricultural
economics is only a phase of an immense field called economics in which primary
attention is paid to the analysis of the economic problems associated with
agriculture; Prof. Gray defines agricultural economics, “as the science in
which the philosophy and systems of economics are applied to the extraordinary circumstances
of agricultural industry.” undoubtedly in cooperation these definitions are
wider in scope, however these are not descriptive and are exemplify by indistinctness
disconcerted.
PROF. HUBBARD DEFINITION OF AGRICULTURAL ECONOMICS
Prof. Hubbard has defined agricultural economics
as, “the study of association arising from the wealth-getting and wealth-using
activity of man in agriculture.” This definition is based o Prof. Ely’s
definition of economics and is mere akin to Marshall’s conception of economic
activities and therefore it is also limited in scope.
SCOPE OF AGRICULTURAL ECONOMICS
Agriculture sector is considered to be
the most important in Indian scenario. The scope of agricultural production
economics includes production, distribution, consumption and government
activities in relation to agriculture and farm enterprises. To be more
specific, the scope of agricultural economics can also be analysed on the
political aspect. Self sufficiency in food produce can reduce foreign dependence
for food supply and raw materials, especially in times of crisis. There is a
large scope of agri. economics in various factors of production also viz. land,
labour, capital, organization etc.
The scope of agricultural production
economics as quoted by Taylor “ Agricultural economics deals with the
principles which underline the farmers’ problems of what to produce and how to
produce what to sell and how to sell in order to secure the largest net profit
for himself consistent with the best interest of the society as a whole. ”
MAJOR TOPIC IN AGRICULTURAL ECONOMICS
Agricultural
environment and natural resources
In the field of environmental
economics, agricultural economists have contributed in three main areas:
designing incentives to control environmental externalities (such as water
pollution due to agricultural production), estimating the value of non-market
benefits from natural resources and environmental amenities (such as an
appealing rural landscape), and the complex interrelationship between economic
activities and environmental consequences. With regard to natural resources,
agricultural economists have developed quantitative tools for improving land
management, preventing erosion, managing pests, protecting biodiversity, and
preventing livestock diseases.
ProductionEconomics and Farm Management
Agricultural
economics research has addressed diminishing returns in agricultural
production, as well as farmers' costs and supply responses. Much research has
applied economic theory to farm-level decisions. Studies of risk and
decision-making under uncertainty have real-world applications to crop
insurance policies and to understanding how farmers in developing countries
make choices about technology adoption. These topics are important for understanding
prospects for producing sufficient food for a growing world population, subject
to new resource and environmental challenges such as water scarcity and global
climate change.
Food and Consumer Economics
While at one time, the field of
agricultural economics was focused primarily on farm-level issues, in recent
years agricultural economists have studied diverse topics related to the economics
of food consumption. In addition to economists' long-standing emphasis on the
effects of prices and incomes, researchers in this field have studied how
information and quality attributes influence consumer behavior. Agricultural
economists have contributed to understanding how households make choices
between purchasing food or preparing it at home, how food prices are
determined, definitions of poverty thresholds, how consumers respond to price
and income changes in a consistent way, and survey and experimental tools for
understanding consumer preferences.
CONCLUSION
Agricultural economics can be understood as a functional
meadow of economics which deals with the application of economic hypothesis in
optimizing the production and distribution of food and fiber. Agricultural
economics began as a branch of economics that specifically dealt with land
usage; it focused on maximizing the crop yield while maintaining a good soil
ecosystem.
Throughout
the 20th century the discipline expanded and the current scope of the
discipline is much broader. Agricultural economics today includes a variety of
applied areas, having considerable overlap with conventional economics.
Agricultural economists have made substantial contributions to research in
economics, econometrics, development economics, and environmental economics.
Agricultural economics influences food policy, agricultural policy, and
environmental policy.
REFERENCES
B.
L. Gardner (2001), "Agriculture, Economics of," International
Encyclopedia of the Social & Behavioral Sciences, v. 1, pp. 337-344.
Abstract & outline.
Piketty, T.: Capital in the 21st
century, August 2013, Belknap Press.
Karl A. Fox (1987). "Agricultural
Economics," The New Palgrave: A Dictionary of Economics, v. 1,
pp. 55–62.
C. Ford Runge (2008). "Agricultural
Economics," The New Palgrave Dictionary of Economics, 2nd Ed.,
Schultz, Theodore (1968). Economic
Growth and Agriculture. New York: MacGraw-Hill.
No comments