Front Cover
 Title Page
 Technology, planning, and...
 Professional pride, problems, and...
 Translocating a green revoluti...
 The call for integration

Group Title: Staff paper - Food and Resource Economics Department - 79
Title: Small farmers cope with risk and scientists
Full Citation
Permanent Link: http://ufdc.ufl.edu/UF00056202/00001
 Material Information
Title: Small farmers cope with risk and scientists
Series Title: Staff paper 79
Physical Description: 17 p. : ; 28 cm.
Language: English
Creator: Andrew, Chris O
Publisher: Food and Resource Economics Dept., Institute of Food and Agricultural Sciences, University of Florida
Place of Publication: Gainesville
Publication Date: 1978
Subject: Farmers -- Job stress   ( lcsh )
Farms, Small   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
non-fiction   ( marcgt )
Bibliography: Includes bibliographical references (p. 16-17).
Statement of Responsibility: by Chris O. Andrew.
General Note: "April 1978."
Funding: Staff paper (University of Florida. Food and Resource Economics Dept.) ;
 Record Information
Bibliographic ID: UF00056202
Volume ID: VID00001
Source Institution: University of Florida
Holding Location: University of Florida
Rights Management: All rights reserved, Board of Trustees of the University of Florida
Resource Identifier: aleph - 001626651
oclc - 22398562
notis - AHQ1350

Table of Contents
    Front Cover
        Front Cover
    Title Page
        Title Page
    Technology, planning, and change
        Page 1
        Page 2
    Professional pride, problems, and performance
        Page 3
        Page 4
        Page 5
        Page 6
    Translocating a green revolution
        Page 7
        Page 8
        Page 9
    The call for integration
        Page 10
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
        Page 17
Full Text




Staff Paper 79

April 1978

Staff Papers are circulated without formal
review by the Food and Resource Economics
Department. Content is the sole responsi-
bility of the author.

Food and Resource Economics Department
Institute of Food and Agricultural Sciences
University of Florida
Gainesville, Florida 32611



Chris 0. Andrew

Technology, Planning and Change

A concern for the role of technology in the development process, how to

plan for creation and utilization of appropriate technology, and how to implement

directed change are crucial concerns of our time. The 1979 U.N. Conference on

Science and Technology for Development will assemble some of our best thoughts

concerning how to approach technology, planning and change in the immediate years

to come. The Humphrey Bill shelved recently by the United States Senate entitled,

"The International Cooperation and Development Act", promised to bring new life

to technical assistance. If such quests are to be successful, agricultural and

social sciences must address global, national, local and family problems from

an integrated stance. For the small farmer, the issue is not who gains credit

for making a major contribution to his ability to survive and to supply food to

others of the world, the issue is that a significant contribution will be made by

someone. It is time for all scientists to join hands and understand the contri-

bution that each can make so that a critical mass of unified intelligence can be

focused on the complex problems challenging small farmers, rural sectors, and the

international agricultural community.

Chris 0. Andrew is Associate Professor of Food and Resource Economics and Assistant
Director of International Programs, Institute of Food and Agricultural Sciences,
University of Florida.


Centralization: A Stress

Change imposed through science and technology implies that stress is

inevitable. As development occurs, there is an implied tendency toward

centralizing many of the political, social and economic activities of a

society. As noted recently by Carey, industrialization implies a movement

toward centralized social, political and economic systems as opposed to the

more heterogenous or decentralized village based societies. The planning

activity, assumes that all peoples must move toward varied but specific forms

of industrialization, thus creating stress for those societies structured around

village systems and rural based societies.

Yet scientists of development and change, have not learned to manage tech-

nology to benefit rural based societies. Possibly we resort to centralized

planning In frustration without full knowledge of the necessary inputs to

effective planning.

In the centralization camp, are many economists and government planners.

Representing decentralization are anthropologists and others who work more

closely with the village based society. Coordination between the polarized pro-

tagonists is strained because each enters the encounter from a very distinct

position. Economists contend that they address a wholelistic set of issues but

these issues are indeed quite macro or global while anthropologists counter with

a micro wholelistic approach. Both "might" agree that the other is important

but modes of interaction become an uncertainty. A major need is to neutralize

the centralization and decentralization dilemma by uniting the two points of

view such that village based societies can be accommodated within the broader

framework of a sustained technological change appropriate to the needs of indus-

trial progress.

Directing Change

Satisfactory change often assumes that the information provided by the

change agent represents a "unified good". When this is not true the small

farmer must cope with both natural risk situations and a patch work of con-

flicting scientific views. Quality in the information to be transmitted depends

entirely upon the degree to which the problem area is fully understood in

all of its complexities and addressed as a whole. An isolated mono-disciplinary

approach to multi-disciplinary problems creates major distortions and abortions

in social and economic systems. The role of the change agent in this unfortunate

circumstance becomes negative by creating unnecessary and detrimental problems to

challenge future programs because the problems are further aggravated. A review

of the literature concerned reveals confusion surrounding the role played by

agricultural, economic and social criteria in the diffusion of innovations and

suggests that the diffusion package has not always contained a "unified good".

The following paper is a focus on this "blind side" of professional pride

in addressing the directed change and innovation question. The basic grains

commodity area is discussed relative to the U. S. hybrid seed experience in

the 1930's and a more recent experience in Guatemala.

Professional Pride, Problems and Performance:

Understanding a U.S. Green Revolution

The diffusion casualty debate of the late 1950's between the agricultural

economists and sociologists in the U.S. ended in a draw. But recent, research

activity in the less developed countries and the need for improved agricultural

and rural conditions suggests that we need to return to the basic elements of

that debate and move forward with new programs.



The debate centered on the diffusion of hybrid seed corn and sorghum

in the Midwest of the U.S. following major research breakthroughs in the

1920's. The unique setting for the diffusion of hybrid seed corn included

the years from 1928 through 1941. International and national economic

depression, drought throughout the North American Midwest and the war in

Europe, changed the effective supply and demand of agricultural commodities.

Most critics assume that such conditions bear on the diffusion of agricultural

innovations but Ryan and Gross remarked that even with these, the rapid spread

of hybrid seed was remarkable given the slowness with which many sound economic

practices are excepted. These gentlemen observed that the inter-active effect

of the individual within the social system was the major contributing factor to

innovation and adoption. More recently, Havens and Rogers attributed adoption

of innovations to the interaction effect and social congruence. But even with

interaction and social congruence conditions, most farmers insisted on personal

experimentation before full use of hybrid seed.

Griliches in the late 1950's stimulated a rather interesting debate when

he suggested that in the long run, and cross sectionally, it was not the

sociological variables that determined whether a new innovation such as hybrid

seed corn would be adopted but that it was the economic variables related to

profitability and income. He went on to say that the sociological variables

would determine the initial order and degree of farmer adoption. Griliches'

research explained about 60 percent of the variation in the rate of adoption of

hybrid corn by the profit motive and, thereby, released a storm of congruence

versus profitability controversies that extended into the 1960's.

Conflicting concepts and interpretations by the sociologists and agricultural

economists extended into the adoption of hybrid sorghum. Bradner and Straus argued


that the likelihood of technological innovations being accepted is enhanced

when these innovations are related to an existing cultural pattern. Concerning

Grillches earlier statement on the importance of profitability in the adoption

rate of hybrid corn and sorghum, Bradner and Straus wrote: "in such a concep-

tualization of the change process, factors such as socio-economic status, economic

resources and group and individual values tend to be seen merely as auxiliary in-

hibitors or facilitators of the change process" (p. 381). Bradner and Straus

continued by saying that contrary to the concept of economic needs, it was the

issues of familiarity and congruity of the new practice with the recently accepted

practice of planting hybrid corn that accounts for the rapid acceptance of hybrid

sorghum. The economists' reply to this was that hybrid corn had been very profitable

and that the congruence factor was related to a profitability expectation.

Havens and Rogers went on to clarify the position of the sociologists by

concluding that perception of profitability and not objective profitability of an

innovation determine adoption rates. Perception of profitability is highly influ-

enced by group interaction and various socio-cultural phenomena.

While the debate reached a point of general agreement and one of differences

in semantics, the reciprocals of either objective or perceived profitability were

overlooked. The roles of economic loss, risk perception and risk aversion appear

to be major concerns as small farmers consider technological change, innovation

and adoption.

Further reflection by Andrew and Alverez on the debate suggests that both

interaction effects and profitability contributed to the diffusion of hybrid corn

and played varied and integral roles depending upon the stage in the diffusion

process and the economic situation encountered by a particular adopter. To conclude

that either interaction or perceived profitability caused adoption of hybrid corn

seems inaccurate. Both were important but other variables such as economic status,

and weather and price uncertainty influenced decisions about adoption. Thus,

one might conclude from the literature, that farmers consider the impact of

innovation on their combined socio-economic positions. For example, relative

advantage, compatability, complexity and divisability of an innovation are

important sociological considerations with parallel economic concerns including

comparative advantage, scale and biological feasibilities, coordination of

input and product markets with complex production systems, and the opportunity

to diversify or spread risk associated with changing from known to relatively

unknown technologies. Along with socio-cultural phenomenon economic losses

and windfall profits are important in the decision making process as agricultural

producers consider technological change.

Problems and Performance

The early debate and expression of professional pride stimulated needed

thought concerning the diffusion process but prohibited establishment of an

integrated approach to agricultural innovation and change. Professional pride

was over-riding, and perpectuated a problem identified earlier by pursuing

greater centralization by economists and decentralization by the sociologists

and anthropologists. This problem in turn has affected the performance of the

scientific community in achieving an integrated approach to agricultural inno-

vation and change.

Thus, without strong leadership from the social scientists, the agricultural

scientists were forced to proceed with their charge to develop high yielding

agricultural technologies. While agriculturalists have been soundly criticized

for not considering the major social implications of their work, many of the

social scientists have pursued unique and interesting disciplinary goals without

specific regard to the total agricultural development problem. Even some social

scientists find it inappropriate to criticize agricultural scientists for this


Let us hope that we are on the frontiers of a new era in integrated science

and technology rather than specialization through unswerving professional pride.

It is appropriate to note that research beyond agricultural adoption has identified

the importance of a combination of cultural, social and economic factors. Acheson,

in reviewing the reaction of the Cuanajo, Mexico community to mechanized carpentry,

concluded that the presence of superior economic opportunities is the single most

important factor involved in developmental change.

Translocating a Green Revolution

From the Midwest U.S. experience in grains production came a desire to share

that experience throughout the world. As early as 1940, Norman Borlaug began in

Mexico the scientific trek which was to produce a new wheat and contribute a

methodology for rice varieties that increased world production potentials signifi-

cantly under appropriate production technologies (Paarlberg). The stage was set

for an international green revolution in basic grains similar to that experienced

in the U.S. Recent conclusions by Rutan concerning the new wheat and rice varieties

in the developing countries of Asia are 1) that adoption has occurred at exception-

ally rapid rates in areas where the varieties are technically and economically

superior to local varieties, 2) that adoption has not been seriously constrained

by farm size and tenure, 3) but that income differentials among regions have become

more skewed while 4) the rate of increase in food grain prices to consumers has


Risk Perception in Guatemala

A review of the Guatemala experience with basic grains can provide further

insights concerning the adoption process and the importance of integrated research and

development programs. Small farmers in Guatemala have experienced fewer income

distribution problems due to the introduction of high yielding basic grain varieties

than some other developing countries. While productivity has increased, internal

adjustments in farm management have resulted in relatively stable total production

of the grains most basic to diets in Guatemala.

The subsistence, land use and crop mix environment on small farms producing

basic grains in Guatemala is characterized by risk aversion as farm size and

relative incomes change (Alverez and Andrew). These farmers primarily grow

traditional crops in association (multiple crop or sequential interplant) on

their few, small and divided plots of land. They may also produce some

commercial crops where risk iniminimal relative to that of other mono crops.

As opposed to low risk traditional crops grown primarily for subsistence, low

risk commercial crops are a source of income where adversity does not extend

beyond normal weather fluctuations. Low risk commercial crops may also include

crops whose prices are supported by the government such as wheat in Guatemala.

The small farmer's behavior within his basic economic system is one of

carefully balancing risk aversion, income maintenance and risk taking at low

income levels. The farmer grows basic grains in association for subsistence

though he may also sell part of his production if income should rise due to

either productivity or price. In that case the farmer may divert some of his land

to other commercial crops while maintaining self sufficiency production on less

land. This response pattern will continue as income rises to the point where it

is feasible to introduce another slightly higher risk but more commercial crop

or until no more land is available. Thus, as incomes rise, small farmers with

their self sufficiency guaranteed tend to diversify production by growing high

value crops, until their land constraint is reached.

The results of this research suggests that there is a built in supply control

mechanism for basic grains and low risk crops in the small farm system. This

mechanism explains why productivity increases while production remains stagnant


in Guatemala. From the farmer's viewpoint, this behavior is a natural reaction

to basic subsistence needs and when all farmers react in this way, it avoids

some of the second (marketing) and third (income distribution) generation problems

of the green revolution (Falcon). SinceAproduction does not result, prices do

not decline sharply to create income disparities and the market system Itself is

not so forcefully challenged.

If these findings are accurate, research and development programs should

carefully consider the total small farm system. Simply identifying and ranking

production systems based on economic phenomena does not describe the reasons

for the subsistence management patterns followed by small farmers in Guatemala.

To delve more deeply into these patterns will require careful attention by

economists and anthropologists to economic conditions and socio-cultural systems

that circumscribe the crop associations in the multiple cropping systems and

influence risk for small farmers. Agronomic research on the basic grains alone

will not entirely serve the small farmers need as he moves through the production

system into higher value higher risk crops. Meeting the risk element squarely

by sociologists, anthropologists, agronomists and economists through an integrated

research program is necessary and could be very productive.

This research further highlights the issue of stress caused by centralization

through national economic planning versus decentralization resulting from the

village small farm system. A primary objective of the Guatemala government is

to achieve major increases in basic grain production on small farms such that

import necessities are reduced. Small farmers are interested in basic grain

production as a basis for subsistence but once this subsistence position is well

established and maintained on a stable basis, the resulting advances in income

will generate investments in commercial production of somewhat higher risk crops

because the income potential is also higher with these crops. Thus, these farmers


will take advantage (ol productivity increases to further solidify their subsistence

needs and absorb the benefits through greater land availability by producing crops

other than basic grains. The agricultural economists and anthropologists must

illustrate to the national planners that diverging objectives at the central

government level versus those at the village level tend to create stress situations

and unrealized objectives at each level. The price policy, to improve income for

basic grain producers as a goal for stimulating production or investments in agri-

cultural research and thereby create higher yielding varieties, may be beneficial
-to ikz results desired by the national government.

The Call for Integration

A Return to Basics

It is time to return to the basics of molding our sciences in such a manner

that we can join together to attack world agricultural problems. For example, we

might begin by defining that part of economics that is culture and that part of

culture that Is economics to provide for understanding between anthropologists and

economists. In a recent article, Hartman presents the proposition that economics,

as both science and culture, recognizes that economics as a discipline, must

embody societies' traditional sense of historical purpose and values and that it

do so in the name of science. Agricultural economics is an applied social science.

But he indicates that one could conclude that agricultural economics in attempting

to fulfill this role as it is now practiced is both bad science and uninformed cul-

ture. Agricultural economics may be neither fish nor fowl. This could be viewed as

a strong point of the discipline because it tends to reduce excessive specialization.

Concerning culture, Bell has specified that culture is used conceptually to

designate societies common sense of purpose and meaning. Thus, culture serves as

a basis for tradition and the embodiment of experiential knowledge accrued over


a long history of events. Cassier goes qn to explain that experiential knowledge

is the basis of human meaning and purpose, And, in that sense, it is prior to

and should take precedence over scientific knowledge as the ground for action

and choice, It is between these two elements that agricultural economists fall.

Understanding Farmers

The above separation may help in better understanding how it is that confusion

results concerning why farmers adopt given practices. Numerous authors have con-

cluded that small farmers perform rationally and efficiently under their particular

resource constraints. For example, Hopper (p. 624) states:

It seems likely that in a technologically stagnant agriculture,
farmers are intuitively aware of the resource substitution
possibilities and the production responses of their agriculture
enterprises. These are embodied in the lore of the culture trans-
mitted from generation to generation and are derived from refine-
ments of techniques that arise from the observations and experi-
ments made by past and present farmers. it is, therefore, not
surprising to find relatively few allocation errors anda high
level of production efficiency within the framework of the
traditional state of the arts.

Further evidence in Kenya suggests that small scale farmers under conditions of

uncertainties behave as efficient, risk-averse entrepreneurs (Wolgin).

With reference to specific work on risk, Benito concludes that among peasants

differences in the endowment of human and physical capital and organizational power

determine the differences in opportunity cost of human time, transaction costs,

and behavior in the face of risky events. The observed distribution of adoption

rates among the peasants households is a combination of factors resulting from

these differences. Contrary to the recent work by Alverez and Andrew and common

findings, one theory suggests that adoption of innovations may be inversely related

to the wealth position of the adopter (Cancian).


To specifically measure and quantify relationships in the risk area is

quite difficult. Moscardi and de Janvry (p. 710) have developed models that

relate socio-economic phenomena and in turn predict risk behavior. They state


Assuming that the safety-first model holds. the degree of
risk aversion manifested by individual peasants can be derived
from observed behavior. Given a production technology, the
risk associated with production and market conditions,the ob-
served level of factor use reveals the underlying degree of
risk aversion. Beyond random discrepancies, it is possible to
establish a systematic relationship between risk aversion and
a number of socio economic variables; (age, schooling, family
ties, off farm income, land under control, solidarity group)
that characterized peasants households, their access to income
generating opportunities, and their relation to public institu-

If farmers are performing consonant with their given environment,. It seems

unlikely that developing major input packages to change a small farm production

system could be effective without broad consideration of numerous factors. For

example, one might ask, what are the relationships between risk taking and

adoption vis-a-vis prestige, income, family size, asset position, education,

age, skill level, previous adoption behavior, cooperation, group behavior, price

expectations, political stability, social stability, land tenure, economic

stability, level of social overhead development including roads, power lines,

dams, transportation systems, and other considerations. To understand limiting

factors within this total spectrum of activities that affect a farmer's willingness

to take risk and produce to meet national desires, will require a joint effort by

various scientists and non-scientists from a wide array of disciplines and back-




Economists have proceeded in an attempt to quantify some of the behavioral

characteristics that parallel economic activity relative to risk. But in doing so,

they have not included an historical dimension to culture that might be provided

by the anthropologists in specifying why "successful" behavior is as it is. Without

this dimension, It becomes extremely difficult to predict for planning purposes.

This type of activity, however, has not been one where anthropologists have been

particularly comfortable in the past. But if their impact is to be fully appre-

clated and utilized, anthropologists must become bold and extending in their

thought. Economists then must appreciate and utilize culture as a basis of

proven experience for planning purposes.

In a national planning sense, as directed change is pursued, careful consid-

eration must be given to policies that are designed to minimize short run problems

and opportunities that tend to create serious long run difficulties. Such condi-

tions should be considered as they would impact on long run employment, price

levels, income transfers and socio-cultural conditions. Economic planners might

learn significantly from working with anthropologists who can view past micro

systems and translate these observations into current.potentials for .change. From

this synthesis anthropologists could help anticipate the long run Implications of

particular actions.

Since planning implies structural modification of various individual rights

relative to resource use, care must be taken. Rights can be viewed in the broadest

of senses including human and natural resources and their separate sensitivities

and components. In both an economic and socio-cultural sense, rights must reflect

economic and social realities. Planning systems that anticipate rule changes

within a legal structure or behavioral code based in culture, should balance

the cost and benefits in monetary and non-monetary terms of such changes. This


somewhat historical perspective is oversimplified in today's world and does not

fully account for the general trend toward more centralized activities in contempo-

rary national and international bodies.

Thus, in a contemporary sense, planning is more complex than most planners

realize in that policy at the macro level does influence the entire environment

within which an individuals rights are based. These rights must be considered

simultaneously with rule changes at the macro level within the code of law whether

it be perpetuated by culture or that prescribed by government. It is at this

point where national goals encounter significant problems in meshing with stated

or unstated laws that govern the village and rural based agricultural sector. As

policy changes are anticipated that affect the distribution of rights, an understanding

of the possible results cannot be achieved without integration of the disciplines

that share in the social, cultural, economic and legal factors encountered by those

who possess those rights. A fundamental conflict in policy making is to determine at

what levels policies should be introduced to effect universal change and at the same

time, what change is going to be effective relative to the goals and asperations of

the target audience -- in our case a world based, low income, limited resource agri-

cultural producer.


A most recent, but not final, word on why limited resource farmers do or do

not adopt innovations relates to the total environment within which the farm system

is located. Various socio-economic conditions and perceptions influence the degree

to which traditional, "small" farmers seek to avert risk in the struggle to augment

their income. To successfully understand risk aversion and perception and to develop

successful policies and programs will require multidisciplinary concern beyond

that presently experienced. The opportunity to diversify or spread risk associated

with changing from known to relatively unknown technologies rests on an ability


to deal with numerous socio economic factqrs. These factors set the stage for

expectations concerning risk as an important influence on the decision making

process when small farm producers consider technological change.

Owing to his subsistence needs, the land constraint and his income level,

the traditional farmer's behavior within his basic economic system is one of

carefully balanced risk aversion, income maintenance and risk taking. The

conceptual model and research results from the work with basic grain producers

in Guatemala suggests that there is a built-in supply control mechanism-for

basic grains and low value-low risk crops in the small farm system. This

mechanism, explaining why productivity increases yet production is stagnant,

is a natural reaction to basic subsistence needs and avoids some of the marketing

and income distribution problems of the green revolution. Over production may

not usually result so prices do not decline sharply to create great income

disparities and the usually disoriented market system does not find itself so

grossly inadequate in terms of handling major production increases.

Research and development programs must carefully consider the total small

farm system from all points of view. Basic research on basic grains alone will

not entirely serve the small Guatamalan farmers needs as he moves into high

value-high risk crops. Meeting the risk elements squarely in the agronomic,

social, anthropological and economic sciences will be necessary and most pro-

ductive. The question is can we as scientists "get it together" and truly help

the small farmer address his total need or must he continue to cope with risk and



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