s 540 . A2 A34 1991 INTt R1•' ,.,-;-i . :: :--· ,tj_ 5: ,.,.,: ··· IL) OdCY . ES·., !Crl I ('.n~·urE AGRICULTURAL RESEARCH POLICY COMPANION VOLUME: ISNAR Agricult11ra/ Research Indicator Series: A Gloha! Datahase 011 Na1io11a/ Agrirnltura/ Research Sysrems: Philip G. Pardey and Johannes Roseboom. Published by Cambridge University Press. 1989. ISBN 0 521 37368 9 A GRICULTURAL RESEARCH POLICY INTERNATIONAL QUANTITATIVE PERSPECTIVES PHILIP G. PARDEY JOH ANNES ROSEBOOM JOCK R. ANDERSON Editors Published for the International Service for National Agricultural Research Tht• riglu af the Universtl\' of Comlmdgc 10 pm11 anti sell alf manner of boob was .~ranfl>d by 1/rnry Vlll m 1534. Thr Unn-ersuy has pmHNI and pubhshed con11n11ously sinrr I 584. C AMBRI DGE UN TVE R S LTY P R ESS Camhridge Ne-.,,,· York Port Chesrer M_elho11me Sw/11er Published by the Press Syndicate of the University of Cambridge The Pitt Building, Trumpington Street, Cambridge CB2 1 RP 40 West 20th Street, New York, NY 10011-4011 , USA 10 Stamford Road, Oakleigh, Melbourne 3166, Australia © International Service for National Agricultural Research 1991 First publi shed I 991 Printed in Great Britain at the University Press, Cambridge A catalogue record of this book is amilahle from the British Library Library of Congress cataloguing in publication data available ISBN O 521 40009 0 hardback J (l J I 1 2 Contents List of Tables List of Illustrations Foreword Acknowledgements List of Contributors Introduction Philip G. Pardey, Johannes Roseboom, and Jock R. Anderson Agricultural Research in a Policy Context Economic Policy and Investment in Rural Public Goods: A Political Economy Perspective Terry L. Roe and Philip G. Pardey Xl xv xvii XIX XXl 1 5 7 1.1 Policies that Transfer Resources from Agriculture 9 1.1.1 Policy Interventions that Distort Incentives in Agriculture: Evidence on Selected Countries 9 1.1.2 Direct Effects of Distorted Agricultural Incentives 14 1.1.3 More Complex and Indirect Effects of Economic Policy 16 1.2 Some Political Economy Dimensions of Economic Policy 23 1.2.1 An Overview of Some Forces Motivating Economic Policy 24 1.2.2 The Economics of Collective Action 26 1.3 Public Investment in Agricultural Research 34 1.4 Concluding Comments 42 A.1.1 Outline of a General Equilibrium Model of Collective Action with Public Goods 45 Agricultural Research in an International Policy Context G. Edward Schuh and George W. Norton 2.1 Background 2.1.1 Changes in the Structure of the International Economy 51 52 53 vi Contents 2.1.2 Trends in World Agricultural Trade 55 2.1.3 Structural or Technological Changes 58 2.1.4 Policy Interventions and the Structure of Protection 59 2.2 Policy Issues 64 2.2.1 The International Debt Problem 64 2.2.2 Shifts in the External Terms of Trade 66 2.2.3 Unstable International Monetary Conditions 67 2.2.4 The Persistent Need to Diversify 68 2.2.5 Environmental and Natural Resource Problems 69 2.2.6 The Role of Foreign Aid to Agriculture in the Context of International Trade 70 2.3 Implicati~:ms for Agricultural Research 77 2.4 Concluding Comment 79 3 Sustainability: Concepts and Implications for Agricultural Research Policy 81 Theodore Graham-Tomasi 3.1 Sustainability: Basic Issues 82 3.1.1 Concepts of Sustainable Development 82 3.1.2 Alternative Concepts of Sustainability 84 3.1.3 Irreversibility and Uncertainty 89 3.2 Sustainability of Agricultural Systems 91 3.2.1 Lack of Sustainability and the Marginal Lands Hypothesis 91 3.2.2 The Marginal Lands Hypothesis Revisited 94 3.3 Sustainability and Agricultural Research 95 3.3.1 Research Policy Issues 95 3.3.2 Research Organization and Management 98 3.4 Towards Measurement of Sustainability 100 3.4.1 Measurement of Resource Degradation 100 3.4.2 Measurement of Environmental Pollution Costs 101 3.5 Conclusion 102 4 Agricultural Research in a Variable and Unpredictable World 103 Jock R. Anderson 4.1 Uncertainty Surrounding Agricultural Research 103 4.1.1 Sources of Variability in the Agricultural Sector 103 4.1.2 Sources of Uncertainty in Agricultural Research 107 4.2 Investing in Research in a Risky Agriculture 109 4.2.1 Research Benefits under Risk 110 4.2.2 Public Investment in Research under Risk 114 4.2.3 Targeting Research to Groups with Special Needs 123 4.2.4 Portfolio Management in Research 126 4.3 Conclusions 127 Contents vii II Measuring Agricultural Research and Economic Development 129 5 Internationally Comparable Growth, Development, and Research Measures 131 6 Barbara J. Craig, Philip G. Pardey, and_ Johannes Roseboom 5.1 Aggregation 5.1.1 Temporal Indices 5.1.2 Spatial Indices 5 .1.3 Multidimensional Indices and Comparable Aggregates 5.2 Aggregation in International Data Sets 5.2.1 Value Aggregates 5.2.2 Noncomparable Volumes 5.3 Constructing Agricultural Development Measures 5.3.1 Agricultural Output Measures 5.3.2 Agricultural Input Measures 5 . .3.3 Productivity Measures 5.4 Constructing Agricultural Research Indicators 5.4.1 Defining a NARS 5.4.2 Research Personnel Indicators 5.4.3 Research Expenditure Indicators 5.4.4 Shortcut Estimation Methods 5.4.5 Comparison with Prior Compilations Patterns of Agricultur~l Growth and Economic Development Barbara J. Craig, Philip G. Pardey, and Johannes Roseboom 6.1 Aggregate Agricultural Growth in Perspective 6.2 Agriculture 's Share in Growth 6.3 Agricultural Productivity 6.3.1 Other Inputs to Agriculture 6.3 .2 Mismeasurement of Agricultural Outputs and Inputs 6.4 Concluding Comments 132 132 133 137 138 138 144 145 145 147 148 152 153 158 160 161 164 173 173 178 182 185 187 189 III Public-Sector Agricultural Research 195 197 7 Regional Perspectives on National Agricultural Research Philip G. Pardey, Johannes Roseboom, and Jock R. Anderson 7.1 Global Agricultural Research Capacity 198 7.1.1 Personnel and Expenditure Aggregates 198 7 .1.2 Real Expenditures per Researcher 202 7.1.3 Size ofNARSs 205 7 .1.4 Agricultural Research Productivity and Intensity Ratios 206 7.2 Agricultural Research in Sub-Saharan Africa 214 7 .2.1 Institutional History 215 viii Contents 7.2.2 Contemporary Developments in Agricultural Research 221 7.3 Agricultural Research in China 226 7.3.1 Characteristics of Chinese Agriculture 227 7.3.2 Patterns of Agricultural Production and Productivity Growth 228 7.3.3 Evolution of the Chinese Agricultural Research System 228 7.3.4 Quantitative Development of Chinese Agricultural Research 232 7.4 Agricultural Research in Asia & Pacific 234 7.4.1 Institutional History 235 7.4.2 Contemporary Developments in Agricultural Research 240 7.5 Agricultural Research in Latin America & Caribbean 243 7.5.1 Institutional History 244 7.5.2 Contemporary Developments in Agricultural Research 248 7.6 Agricultural Research in West Asia & North Africa 251 7.6.1 Institutional History 252 7.6.2 Contemporary Developments in Agricultural Research 252 7.7 Agricultural Research in the More-Developed Countries 255 7.7.1 Institutional History 255 7.7.2 Contemporary Developments in Agricultural Research 260 7.8 Concluding Comments 263 8 Topical Perspectives on National Agricultural Research 265 Philip G. Pardey, Johannes Roseboom, and Jock R. Anderson 8.1 The Commodity Focus of Agricultural Research 265 8.1.1 Measurement Options 266 8.1.2 Commodity Orientations 267 8.1.3 Congruence Comparisons 269 8.2 Factor Shares in Agricultural Research 272 8.2.1 Physical Capital 273 8.2.2 N oncapital Inputs 275 8.2.3 Cross-Country Price Differentials 279 8.3 The Human Capital Component of Agricultural Research 281 8.3.1 Qualification Profiles 283 8.3.2 Expatriate Researchers 287 8.4 Size, Scope, and Spillovers 289 8.4.1 Size 289 8.4.2 Scope 291 8.4.3 Spillovers 293 8.4.4. Some Empirical Observations 294 8.5 Sources and Structure of Support 299 8.5.1 A Transactions Perspective 299 8.5.2 Donor-Sourced Funding 302 8.6 Concluding Comment 307 Contents ix 9 International Agricultural Research 309 Guido Gryseels and Jock R. Anderson 9.1 The CGIAR 309 9.1.1 Institutional Background 310 9.1.2 Evolving CGIAR Priorities and Strategies 312 9.1.3 Trends in CGIAR Resource Allocation 314 9.1.4 Issues Related to CGIAR Policy Choices 322 9.2 Other International Agricultural Research 329 9.2.1 CG-Kindred Centers 329 9.2.2 Other Multilateral Agencies 332 9.3 Bilateral Agricultural Research 333 9.4 Final Comments 335 IV Private-Sector Agricultural Research 341 10 Private-Sector Agricultural Research in Less-Developed Countries 343 Carl E. Pray and Ruben G. Echeverria 10.1 Relationships between Public- and Private-Sector Agricultural Research 345 10.1.1 Types and Sources of Agricultural Technologies 345 10.1.2 The Public-Good Nature of Agricultural Research Output 347 10.1.3 Is Private Research a Substitute for Public Research? 348 10.2 Determinants of Private Investments in Agricultural Research 349 10.2.1 Theoretical Concepts 350 10.2.2 Recent Evidence 353 10.3 The Nature and Scope of Private Agricultural R&D 357 10.3.1 Private Research Activities by Type of Technology 357 10.3.2 Private Research Activities by Region 358 10.4 Summary and Conclusions 363 11 Impact of Research and Seed Trade on Maize Productivity 365 Ruben G. Echeverria 11.1 The Maize Seed Industry 366 11.1.1 Typology of Maize Varieties 366 11.1.2 Maize Seed Production 369 11.1.3 Maize Seed Trade 372 11.1.4 Maize Research 376 11.1.5 Maize Productivity 379 11.2 The Impact of Public and Private Research on Maize Yields 382 11.2.1 A Response Function Model 383 11.2.2 Analysis and Results 387 11.3 Policy Implications 392 11.4 Conclusions 394 I I I x Contents V Emerging Issues 12 Challenges to Agricultural Research in the 21st Century Vernon W. Ruttan 12.1 Technology, Institutions, and the Environment 12.2 Biological and Technical Constraints 12.2.1 Advances in Conventional Technology as the Primary Source of Growth 12.2.2 Advances in Conventional Technology Will Be Inadequate 12.2.3 Issues to Be Met over the Next Two Decades 12.3 Resource and Environmental Constraints 12.3.1 An Overview 12.3.2 Emerging Research Implications 12.4 Concluding Perspective Appendix National Agricultural Research Expenditure and Personnel 397 399 399 402 402 403 403 406 406 408 411 Estimates, 1961-85 413 References Author Index Subject Index 423 447 451 List of Tables 1.1 Direct, Indirect, and Total Nominal Protection Rates for Exported Products 1.2 Direct, Indirect, and Total Nominal Protection Rates for Imported Products 1.3 Fiscal Deficit as a Percentage of GNP and Official Currency Exchange Rates as a Percentage of Computed Rates, Selected Countries 1.4 Correlation between the Fiscal Deficit as a Percentage of GNP and the Nominal Rate of Protection, Selected Countries 1.5 The Rural Household's Decision Rule for Determining Its Willingness to Pay to Influence Economic Policy in Its Favor 1.6 Agricultural Research Intensity Ratios, Simple and Weighted Averages L.7 Agricultural Research and Public-Sector Expenditure Shares 1.8 Public Spending per Capita on Agriculture and Agricultural Research 2.1 Average Annual Percentage Growth of Agricu 1 tu ral Ex ports 2.2 Cereal Trade and Percentage Change between 1974-76 and 1986-88 2.3 Cereal Yields and Percentage Change between 1974-76 and 1984-86 2.4 Ranking of Producer Subsidy Equivalent (PSE) Levels 2.5 Nominal Protection Coefficients for Producer and Consumer Prices of Selected Commodities in More-Developed Countries, 1980-82 2.6 Debt Indicators for Less-Developed Countries, 1980-86 2. 7 Annual Growth Rates in the Consumption of Grains, 1961-83 2.8 Agricultural Production Function with Foreign Aid Variables for 98 Less-Developed Countries 2.9 Parameter Estimates from Growth Model, 1970-80 4.1 Proportional Risk Deduction and Size of Industry, PNG Cocoa Research 4.2 Alternative Investment Experiment, PNG Cocoa Research 5.1 Difference in Growth in Real Agricultural Output Using Alternative Deflators 5.2 Alternative Measures of the Volume of Agricultural Research Resources, 198 1-85 Average 5.3 Primary and Secondary School Enrollment Ratios 5.4 Specification of Shortcut Estimating Equations 5.5 Level of Investment in Agricultural Research - Comparison of Pardey and Roseboom with Judd, Boyce, and Evenson Estimates, Percentage Differences 5.6 Growth of Investment in Agricultural Research - Comparison of Pardey and Roseboom with Judd, Boyce, and Evenson Estimates AS. I Agricultural Land A5.2 Economically Active Agricultural Population 10 11 13 14 28 36 41 42 56 57 58 61 63 65 68 72 76 122 123 139 142 149 162 167 168 170 172 xii List ofTahles 6.1 Development of GDP, Total Population, and GDP per Capita, 1961-65 to 1981-85 174 6.2 Development of Nonagricultural and Agricultural per Capita GDP, 1961-65 to 1981-85 175 6.3 Regional Shares of Total GDP and Population and of Agricultural GDP, Population, and Land, 1981-85 Average 176 6.4 Hectares of Agricultural Land per Agricultural Worker 184 6.5 Average Annual Growth of Fertilizer Use 186 A6. l Fertilizer Consumption 190 A6.2 Tractors in Use in Agriculture 192 7. I Agricultural Research Personnel and Expenditures, Regional Totals 200 7.2 Growth of Agricultural Research Personnel and Expenditures, Compound Annual Averages 20 I 7 .3 Real Expenditures per Researcher per Year 203 7.4 Agricultural Research Partial Productivity Ratios 209 7.5 Agricultural Rese_arch Factor Intensity Ratios 211 7.6 Research Spending and Productivity Growth in Agriculture 213 7.7 Agricultural Research Personnel and Expenditures in sub-Saharan Africa 222 7.8 Real Expenditures per Researcher in sub-Saharan Africa 223 7.9 Nationality and Qualification Levels of sub-Saharan African Researchers, 1981-85 Average 224 7 .10 Experience Profiles of Researchers in sub-Saharan Africa 226 7.11 Indices of Agricultural Production and L and and Labor Productivity for China, 1965 = 100 229 7 .12 Quantitative Aspects of Agricultural Research in China 234 7.13 Agricultural Research Personnel and Expenditures in Asia & Pacific 241 7.14 Real Expenditures per Researcher in Asia & Pacific 242 7 .15 Asia & Pacific NARSs Classified According to the Number of Researchers Employed 242 7.16 Agricultural Research Personnel and Expenditures in Latin America & Caribbean 249 7.17 Latin America & Caribbean NARSs Classified According to the Number of Researchers Employed 250 7 .18 Real Expenditures per Researcher in Latin America & Caribbean 251 7.19 Agricultural Research Personnel and Expenditures in West Asia & North Africa 253 7.20 West Asia & North African NARSs Classified According to the Number of Researchers Employed 254 7 .21 Real Expenditures per Researcher in West Asia & North Africa 254 7.22 Agricultural Research Personnel and Expenditures in More-Developed Countries 261 7.23 Real Expenditures per Researcher in More-Developed Countries 263 8.1 Agricultural Researchers Classified by Commodity Orientation and Type of Organization, 1981-85 Sample Average 268 8.2 Estimated Total Research Expenditures and Researchers in Less-Developed Countries by Research Orientation, 1981-85 Average 268 8.3 Agricultural Researchers in Less-Developed Regions by Research Orientation, 1981-85 Average 269 8.4 Congruence between AgGDP and Agricultural Research Personnel 270 8.5 Forestry Research Expenditures by Region 271 8.6 Agricultural Research Expenditures by Factor Share, 1981-85 Average 273 8.7 Salaries and Operating Costs and Their Shares in Recurrent Agricultural Research Expenditures, 1981-85 Average 276 8.8 Salaries and Operating Costs and Their Shares in Recurrent Agricultural Research Expenditures, Adjusted for Differences in Sectoral Purchasing Power, 1981-85 Average 280 8.9 Nationality and Degree Status of Agricultural Researchers, 1981-85 Average 284 List of Tables xiii 8.10 Degree Status of Agricultural Researchers in Selected More-Developed Countries 286 8.11 Features and Growth of NARSs According to Size of Research System 294 8.12 The Link between Population Size and Research Intensities, 1981-85 Average 295 8.13 Donor Contributions to NARSs in Less-Developed Countries as Reported by Donors 304 8.14 World Banlc Contributions to Agricultural Research in Less-Developed Countries 304 8.15 Share of Donor Funding in Total Agricultural Research Expenditures as Reported by Recipient NARSs, 1981-85 Average 307 9.1 Total CGIAR Core and Special-Project Expenditures by Center, in Millions of Current US Dollars 315 9.2 Total CGIAR Expenditures by Type and Source 316 9.3 Donor Contribution to Core Programs of the CGIAR 317 9.4 Senior Professional Staff by CGIAR Center 319 9.5 Functional Breakdown of Core Operating Expenditures 320 9.6 "Commodity" Orientation of CGIAR Core Research Operating Expenditures 320 9.7 CGIAR Core Operating Expenditures by Category, Apportioned by Geographic Region, 1986-88 Average 321 9.8 Distribution of Population, the Poor, Agricultural GDP, and CGIAR Operating Expenditures among Less-Developed Regions 324 9.9 Grouping of Dates of Foundation of Multilateral Agricultural Research (-Supporting) Centers 330 9.10 Other Multilateral Agricultural Research and Research-Supporting Institutes Based in Less-Developed Countries 332 A9.1 Key Features of the CGIAR Centers 336 A9.2 Key Features of the Nine CG-Kindred Centers under Consideration for Entry to the CGIAR 338 I 0.1 Potential Sources of Agricultural Technologies 346 10.2 Factors Influencing the Level of Private Agricultural R&D 350 10.3 Determinants of Private Agricultural R&D in Less-Developed Countries 354 10.4 A Summary of Private-Sector Food and Agricultural R&D Expenditure Estimates in the 1980s 359 10.5 An Estimate of Multinational R&D Expenditures in Less-Developed Countries, 1985-90 Average 360 11.1 Maize Varietal Types 367 11.2 . World Maize Area under Different Varietal Types, 1985-86 368 11.3 World Maize Seed Values of Different Varietal Types, 1985-86 369 11.4 Public- and Private-Sector Involvement in Maize Seed Industries, 1985-86 370 I 1.5. Private-Sector Share of Maize Seed Sales in Market Economies, 1985-86 371 11.6 Seed Production and Trade of Main European Maize Producers, 1980-82 Average 374 11.7 Estimated Area Sown with Hybrid Maize Seed Imported from the US, 1985-86 375 11.8 Descriptive Statistics for 45 Selected Countries, 1960-85 384 11.9 Yield Response Function Results for 45 Countries. 1960-85 388 A 11.1 Maize Production, Area, Yield, and Growth Rate of 45 Selected Maize Producing Countries 396 4.1 4.2 4.3 4.4 5.1 5.2a 5.2b 5.3a 5.3b 5.4 6.1 6.2 6.3 6.4 7.la 7.lb • 7.2 7.3 7.4 7.5 8.1 8.2 8.3 8.4 9.1 List of Illustrations A knowledge (publications) production function for equation 4.7 A relationship between publications and supply-curve shifts for equation 4.~ Financial performance probability distributions for base-case cocoa research Illustrative iso-proportional risk deductions; A = 2, CNPV = 0.27, CGNP = 0.04 Wheat- versus egg-equivalent output measures Percentage deviation of convert-first from deflate-first formula using annual average exchange rate convertors and implicit GDP deflators (Base-year= 1980) Percentage deviation of conve1t-first from deflate-first formula using PPP convertors and implicit GDP deflators (Base-year = 1980) Quality-unadjusted land and labor productivity paths for the US, 1949-85 Quality-adjusted land and labor productivity paths for the US, 1949-85 Proportion of estimates derived by direct and shortcut methods AgGDP as a percentage of GDP, 1961-85 Changes over five-year intervals in GDP per capita decomposed into contributions by the agricultural and the nonagricultural sector and the intersectoral shift in labor, 1961 -65 to 1981-85 Value-added per worker in the agricultural relative to the nonagricultural sector, 1961-85 International comparison of land and labor productivities, 1961-85 Agricultural researchers, regional shares Agricultural research expenditures, regional shares Total investment as a percentage of GDP, 1971-85 Size distribution of NARSs Agricultural research intensity ratios, 1981-85 average Development of agricultural research expenditures and personnel in China, 1961-85 Real expenditure per researcher in US agricultural experiment stations, 1890-1985 Research labor-capital ratios for the US agricultural experiment station system, 1890-1985 Degree status of US experiment station researchers, 1890-1980 Donor component of less-developed country NARS expenditures Breakdown of total CGIAR expenditures by core operating, core capital, and special­ project expenditures, percentage shares by year 117 118 120 125 137 143 143 151 151 164 177 180 181 183 199 199 202 205 207 233 277 278 285 306 314 I I I I xvi List of Illustrations 11.1 USA and EEC maize seed exports to the rest of the world 11.2 Maize seed exports within the EEC and from the EEC to the rest of the world 11.3 Public- and private-sector interaction in maize research and seed production 11.4 Maize production, area, and yield, 1955-87 12.1 Contributions to increases in radiative forcing in the 1990s 373 374 377 380 407 Foreword After the publication of the ISNAR Agricultural Research Indicator Series (Cambridge University Press, 1989), the obvious next step was an in-depth analysis of the Indicator Series data as they relate to agricultural research policy. This volume provides such analysis and more. The editors and the authors of the various chapters have grappled with some of the most important facets of what is an extremely complex subject, and many issues have been raised. Naturally, not all the issues of agricultural research policy have been addressed here, but those that are included have been placed in a quantitative framework to the extent possible. The results of the analyses and the views expressed by the authors are informative and thought-provoking, providing a more solid basis for policy-making than has been available in the past. This book is aimed at agricultural research policymakers and analysts as well as those who influence present and future policies, be they in government, at universities, at research institutes, or in the donor communities. It will also be of special interest to policymakers within national agricultural research systems who want comparative data of a regional or international nature. We at ISNAR are confident that this book will become an essential input to research policy development. The potential beneficiaries of agricultural research, of both the present and the new century, urgently require far-reaching decisions and action. Christian Bonte-Friedheim Acknowledgements The completion of this book owes much to the patience and encouragement ofISNAR' s past and present management. The seeds of the endeavor were sown by Bill Gamble, \11ere nurtured by Alexander von der Osten, and have come to fruition under Christian Bonte­ Friedheim, while Howard Elliott provided a continuity of support throughout the project. Meanwhile, there were changes in the lives of the team that worked on this book, including at least a successful gestation and delivery, a hip replacement, a man-iage, and a job change, to mention just a little of the larger history of the project. The work reported here involved the collection, cleaning, compilation, and analysis of a good deal of data. In this regard we have been ably and cheerfully assisted by Wilhelmina Eveleens, Sandra Kang, and Bonnie Folger. Our persistent demands for information have been well served by ISNAR's library staff, Peter Ballantyne and Sandra Gardner. Many colleagues at ISNAR, the Universities of Minnesota and New England, the World Bank, sister CGIAR institutes, the TAC and CGIAR Secretariats, and national agricultural research systems offered constructive criticism and suggestions on this material as it devel"ped. We would particularly like to single out Christian Bonte-Friedheim, John Dillon, and Wilhelmina Eveleens who each read and commented on major sections of the manuscript. This work would not have reached this stage but for the sustained and highly creative endeavors of Fionnuala Hawes on the word processing, layout, and related technological fronts, and Kathleen Sheridan in the editorial and publishing department. We are most grateful for their faith and endurance in the enterprise. Richard Claase's design flair is also well represented. The on-going financial support of the Italian government for the data base and research policy work at ISNAR is especially acknowledged. The authors who worked with us through several drafts in order to produce what we feel is a coherent body of work, are also deserving of a final thank-you. We are grateful to ISNAR for providing this forum; naturally, final responsibility for the opinions expressed herein rests with the respective authors. Philip Pardey, Johannes Roseboom, and Jock Anderson List of Contributors Jock R. Anderson Barbara J. Craig Ruben E. Echeverria Shenggen Fan Theodore Graham-Tomasi Guido Gryseels George W. Norton Philip G. Pardey Carl E. Pray Terry L. Roe Johannes Roseboom Vernon W. Ruttan G. Edward Schuh World Bank and University of New England Oberlin College ISNAR ISNAR and University of Minnesota University of Minnesota TAC Secretariat - CGIAR, FAO Virginia Tech and ISNAR ISNAR and University of Minnesota Rutgers University University of Minnesota ISNAR University of Minnesota Hubert H. Humphrey Institute, University of Minnesota Introduction Policy cauldrons have a way of fermenting vigorously even in the absence of applied heat, presumably because public investment in policy analysis obliges activity, even when there is little at stake other than the livelihood of the analysts themselves. Heat is, however, applied from time to time and then the analysts must get really busy. In the agricultural research policy arena, the close of the century is definitely a period of noteworthy ferment in almost every conceivable dimension of policy discussion. Geo­ political developments are changing the political map of the world and are unlikely to stabilize by the imminent end of the millennium. The old cliches of first, second, and third worlds may soon lose much of their descriptive value as new alliances and pri01ities emerge. One thing seems certain. The flow of official development assistance to what have generally been recognized as less-developed countries seems destined to be seriously compromised. Agricultural research assistance has been a small but economically signifi­ cant part of official development assistance, especially in terms of fostering agricultural productivity and growth. Depending on donors' perceptions and priorities, commitments to this minor but crucial component of official development assistance are thus in question as competing demands on always-limited resources are made. It was T. W. Schultz (1964, p. vii) who likened the sophistication of those involved in the agricultural policy process to farmers who planted crops according to the phases of the moon. Be that as it may, it is our presumption, perhaps (but hopefully not) naive, that such policy decision making can only be aided by access to better information. Accordingly, the intention in this volume is to move the policy dialogue beyond merely qualitative impressions and toward a process that is underpinned with data-data that are new, cogent, and informative. These data derive from a long-standing ISNAR-based endeavor to describe just what has been happening in the world of agricultural research - and it is this world rather than the related worlds of agricultural extension and technology that we address in this volume. Many of the data were reported in an antecedent volume (Pardey and Roseboom 1989) in a rather undigested form. What is attempted in this new volume is analysis and interpretation c: these data frorr several contrasting perspectives. Some of these perspec­ tives are fairly predictable; for instance, no serious observer of the policy forces that shape 2 Introduction the nature and level of public investment in agricultural research should be surprised to see chapter 1 address the public-good dimension of agricultural research from a political economy perspective. This public-policy worldview is maintained in chapter 2, which addresses more international dimensions of agricultural research policy and focuses on the "interconnected­ ness" of the human species through trade and the profound benefits that can, and indeed should, be derived from it. Agricultural research, through its influences in changing resource productivity in a world of diverse resource endowments, plays a vital role in international competitiveness and trade, and thus also in international patterns of growth and development. If only life could be so simple. Some of the cc.:serns for the environment raised in chapter 2 are taken up in the review of the major contemporary concerns for "sustainability" in chapter 3. The semantics here are anything but settled, but what is certain is that this issue will add to the challenge facing policymakers for decades to come. Concerns over the environment, broadly defined, are variously popular, pressing, and imperative, but what makes them particularly fascinating and challenging is the lack of certain resolution for most of them. Agricultural research, of course, is no stranger to Lhe lack of certainty in its accom­ plishments. Analysts typically, and perhaps often quite defensibly, seem to act as if uncertainty did not pervade both the agricultural sector and the research endeavors within it. The purpose in chapter 4 is to indicate when this approach might be appropriate or (for the somewhat rare cases) when something more interventionist may be justified. The broad context of agricultural research as an ingredient in economic development is taken up in part II. Taking at face value the idea of crawling before we walk, chapter 5 grapples with measurement issues that cannot be dodged in dealing with data from different countries and different data bases at different times under different economic regimes. Not all the answers are entirely happy but procedures that seem "most reasonable" are identified and thus provide the basis for much of the quantitative material that follows. In chapter 6, the preferred procedures (in short, deflate-first and then convert for best international comparability) are used to describe patterns of growth and development for major regions. This theme is explored in much greater deplh in part III, which begins in chapter 7 with detailed regional quantitative descriptions of recently available data. The regions used for this purpose are the much-troubled sub-Saharan Africa, the large and rather successful Asia & Pacific, as well as China separately, debt-ridden Latin America & Caribbean, and the agroecologically challenging West Asia & North Africa. A further "region" is intro­ duced for comparative insight, namely the more-developed countries of the first world, which, in their historical development, sur~ly have many lessons for their later-developing counterparts. The next two chapters in this part take up issues less regional in orientation. Chapter 8 brings new data to bear on several broad policy issues facing national systems, such as how many, what sort, why, when, on what, whom, and so on. The very significant and complementary international initiatives that bear on many of these same questions are Introduction 3 addressed in chapter 9, where the evolutionary issues of the CGIAR are especially addressed. In this day and age, when the issue of private-public balance has virtually joined the rhetoric of the street, no consideration of agricultural research policy would pretend to be adequately complete without due consideration of the roles of the private sector. This is taken up in part IV. The book is completed with a final chapter that places the subject matter of this volume in the context of the challenges that face agricultural research policymakers as we move forward to the 21st century. Philip Pardey, Johannes Roseboom, and Jock Anderson , -<'.''.'.':'~i~\i11J -"' ,:I I I • ·~ AGRICULTURAL RESEARCH IN A POLICY CONTEXT PART I Chapter 1 Economic Policy and Investment in Rural Public Goods: A Political Economy Perspective Terry L. Roe and Philip G. Pardey This chapter focuses on the interdependence between countries' agricultural and foreign trade policy and their ability and commitment to increase the productivity of resources in agriculture. Governments in less-developed countries typically play a pervasive role in their economies. This role may be warranted in agriculture for those cases where markets fail to provide socially optimal levels of agricultural technology, rural infrastructure, education, information, and other services that lower market transaction costs1 and increase the productivity of land and labor. However, the amelioration of market failure is hampered in less-developed countries for many of the same reasons that cause markets to fail (Stiglitz 1989); these include the lack of human capital and inadequate public infrastructure required to identify and assess the opportunity costs of market failures, and to perform the fiscal and allocative functions required to address them. Under such circumstances "government failure" may be more limiting than market failure (Krueger 1990). Bates (1983) and numerous others (e.g. , Srinivasan 1985; de Janvry and Sadoulet 1989) have pointed out that attempts to address market failure are often exacerbated by the collective action of special interest groups. These groups tend to place pressure on govern­ ments to seek their own differential advantage with the unintended effect of taxing others and directing resources away from productive and into unproductive profit-seeking activi­ ties (Bhagwati 1982). In the case of less-developed countries, these pressures often result in economic policy havi:r