Institutional reforms for getting an agricultural knowledge system to play its role in economic growth

Pakistan Development Review, Winter, 1999 by Jock R. Anderson

Investments in Agricultural Research Systems: in many countries, especially the less-developed, are considerably reduced from the levels of the early 1980s [Pardey, Roseboom and Anderson (1991)] and have stagnated in the institutions making up the Consultative Group on International Agricultural Research (CGIAR) [Anderson (1998)] as well as in many industrial countries, including the U.S. [Alston and Pardey (1996); Alston, Pardey and Smith (1997)]. Moreover, in many LDCs, research institutions have responded to reduced funding by seeking to maintain salaries, so that the brunt of the reduction in research resources has fallen on nonhuman components of the research enterprise. The result has been, inter alia, greatly reduced support for field investigatory work and failure to maintain libraries [Pardey, Roseboom and Beintema (1995); Purcell and Anderson (1997)]. The productivity of these research systems in developing new agriculturally relevant knowledge is thus bound to be degraded. And there are other problems of governance, management and incentives that compromise the productivity of research investments! These are taken up in didactic style in Section 5.

The threat to the capacity of the LDC agricultural research systems and the CGIAR institutions to expand the supply of knowledge resources may be made more critical by emerging trends in the kinds of knowledge that will be needed in the future. Those trends indicate growing need for attention to the environmental, or off-farm, consequences of agricultural production, e.g., losses of wild plants and animal habitat when farmers clear forests and drain wetlands to produce crops. Keeping the costs of these kinds of consequences within socially acceptable limits will require increased knowledge of institutional forms that provide farmers incentives to give these costs their proper weight in farm management decisions. This kind of knowledge is in short supply, and the existing agricultural research institutions are not well-placed to increase the supply on the necessary scale [Crosson and Anderson (1993)]. For several decades, those institutions, both in the LDCs and in the CGIAR, have focused on developing technologies and management practices that would increase on-farm productivity. The Green Revolution in wheat and rice production exemplifies and provides a measure of the great success of this research. Policies to assure farmers more profitable access to the component inputs of that revolutionary change in productivity, and to output markets, were an important part of this success. But these policies did not require increased knowledge of how market institutions work, only the political will to let them work.

In contrast, dealing with environmental consequences of agriculture presents problems precisely because of institutional failure arising from difficulties of establishing and enforcing property rights in environmental resources, e.g., plant and animal wildlife, or the quality of water in streams, lakes and reservoirs. The acknowledged skill of agricultural research institutions is not well-adapted to developing the kinds of knowledge needed to overcome this type of institutional failure. Hence, the emerging importance of dealing with the environmental consequences of agriculture would heighten the challenge to these institutions, even if their level of funding and their efficacy of operation were not under threat.