For fifty years I have wondered what the difference was between a department of agriculture and resource economics (ARE) and ECON? Thinking about it for over forty years, I’ll tell you how I came up with an answer. I started my working life as a computer programmer and studied economics and statistics in Israel. Eithan Hochman and Uri Regev, two of my teachers, encouraged me to approach Berkeley Ag Econ. “It has the same program as Econ, it provides better support and the people are great. The department will allow you to do whatever you want and Berkeley is California’s gem, the Promised Land. “
In Berkeley, I kept wondering. Professor Andy Schmitz said ag econ is econ, with some emphasis on agriculture. He advocated publishing in Econ journals on general issues and opportunistic writing of articles on agricultural issues. My department chairman, Jim Boles, knew we were receiving money from the Agricultural Experiment Station to do agriculture-related work and hired Regev and Hochman (as visiting lecturers) to work on the Experiment Station project. I collaborated with Hochman to study the economics of animal waste and my IT background helped us write some articles aimed at both farmers and economists. Regev worked on high-impact articles regarding biological pest control. At the time, the department hired excellent people in agricultural economics, and Alain de Janvry ran our popular economic development program. However, agrarian economics was considered a minor area of investigation and few of us attended the meeting of the Agricultural Economics Association. Then came Gordon Rausser and he became our department chair.
Gordon realized we couldn’t last as the second best econ department in Berkeley and instead challenged us to become the best ARE department in the country (we won the challenge). Gordon assigned me to teach Agricultural Policy and was very supportive as I educated myself on the subject. He provided travel resources and good research assistants, but insisted that I would not spend my research funds on the exciting issue, “factors that affect basketball game prices.” I started going to Ag Econ meetings and discovered a new universe parallel to the mainstream economic world. There was more real-world emphasis on technology adoption, supply chain, future markets, and political economy. While the analyzes may not be as elegant as can be seen in the mainstream economy, there has been a lot of conceptual innovation and relevance. I understood that this is my discipline.
What are the differences?
These are closely related disciplines with a symbiotic relationship, but agecon is not a pure subset of economics. Economics aims to understand behavior and explain prices, resource allocation, production patterns, macroeconomics and international trade. Over time, its coverage has grown to account for nearly all human choices, including marriage and interaction within the family, and political outcomes. When I was a college student, we learned the laws of supply and demand as well as Say’s law (“Supply creates its own demand.”) And my teachers stressed the importance of identifying general behavioral patterns through a rigorous analysis. Economics aspires to be a “basic science” like physics, with the aim of explaining the main models, but economics itself has evolved. At first it was based on logic, so its content has been enriched by developments in mathematics, statistics, data science and other social sciences. Like physics, economics generates principles and techniques that can be applied to improve human life, and economics has spawned multiple applied disciplines that address significant practical aspects of life.
Agrarian economics emerged as the union of agricultural economics and agricultural management and evolved into agricultural schools. Over time, the domain of the field expanded to include the entire food supply chain, natural resources and development, but the practical essence remained. ARE departments are part of vocational schools that aim to solve problems of production, management, use of food, natural resources and the environment. Agricultural and resource economics should integrate disciplines such as plant biology, agronomy, applied environmental sciences and nutrition. These disciplines tend to develop technologies and practices to address major challenges (increased productivity, reduced pollution, etc.). ARE should clarify how these technologies benefit society: when and where to adopt them? How can policies address some of their harmful side effects? What are the distributional impacts of the policies and how to improve them? The relationship between ARE and ECON is like that between physics and engineering or economics and business administration.
Agricultural and resource economists have emphasized multidisciplinary work and collaboration with scientists aiming to solve emerging problems. Their research portfolio includes applied theories that integrate socio-political systems with natural resources and studies to evaluate past policies, project their impacts and design new approaches for diverse decision makers, from farmers to local government and the international community. In addition to research and education of undergraduate and graduate students, the departments of the ARE department aim to train professionals and policy makers through their extension activities. Economists of agriculture and resources have discovered aspects of reality and techniques that have enriched basic economic knowledge and published in leading economic and scientific journals. In addition, they improved economic methods of estimation and analysis and introduced new research areas, including the economics of adoption and human capital.
When agricultural economists primarily aspire to publish business journals, they may underestimate research that addresses specific problems of agriculture and natural resources, leading to the misuse of public money. University of California campuses don’t need more business departments. However, the challenges of climate change, biodiversity and water loss, and food security urgently require research that combines rigorous understanding of economics and policies with knowledge of the topic in ARE departments. There is an incorrect allocation of resources when the “top 5” ECON journals serve as the primary reference point for ARE research. We can develop researchers and scholars who lack the skills and produce the essential knowledge to solve the problems their departments have been authorized to address.
When Gordon Rausser became our president and asked us to emphasize agriculture and resource economics and sometimes to forgo research that might attract a more “prestigious” outlet but has little to do with our mission, for a bit ‘I resented. Now I realize the wisdom of his vision. A significant challenge for ARE departments and the schools of natural resources to which they belong is to use the new tools of biology and information technology and develop the knowledge and skills that address crucial social problems. In particular, to contribute to the decarbonisation of the economy, moving from non-renewable resources to renewable resources and supplying nutritious and affordable food in a sustainable way. To face these challenges it is necessary to publish in the most relevant and impactful channels, which are not necessarily the most prestigious. University administrators and the scientific community should rate publications based on their content, not their points of sale. ARE and ECON should co-evolve, pursuing their distinct missions, thus helping to make the world a better place.