Comments on: 3 Reasons Comparative Advantage Doesn’t Apply to Agriculture http://www.goodeater.org/2010/01/27/3-reasons-comparative-advantage-doesn%e2%80%99t-apply-to-agriculture/ Professional Voices on Sustainable Food Sat, 31 Jul 2010 21:25:37 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Nigel Dorward http://www.goodeater.org/2010/01/27/3-reasons-comparative-advantage-doesn%e2%80%99t-apply-to-agriculture/comment-page-1/#comment-265 Nigel Dorward Sat, 08 May 2010 07:35:50 +0000 http://www.goodeater.org/?p=999#comment-265 Josh! Some good solid stuff, especially from my perspective sitting in Africa and working in the Ag sector. The sooner natural equilibrium is established in food markets the better. however, i fear that undoing all the subsidies and government support to growers and processors in the Western World is not going to happen as it is too politically risky for sitting governments. We hoped the Obama administration might breathe some new life into American aid policies here but it still looks like lots of the old. Aid chanelled at supporting massive overheads and very little at direct investment on the ground. Continue along your lines of thought we must! Josh! Some good solid stuff, especially from my perspective sitting in Africa and working in the Ag sector. The sooner natural equilibrium is established in food markets the better. however, i fear that undoing all the subsidies and government support to growers and processors in the Western World is not going to happen as it is too politically risky for sitting governments.
We hoped the Obama administration might breathe some new life into American aid policies here but it still looks like lots of the old. Aid chanelled at supporting massive overheads and very little at direct investment on the ground.
Continue along your lines of thought we must!

]]> By: Justin Bowen http://www.goodeater.org/2010/01/27/3-reasons-comparative-advantage-doesn%e2%80%99t-apply-to-agriculture/comment-page-1/#comment-218 Justin Bowen Tue, 27 Apr 2010 13:04:11 +0000 http://www.goodeater.org/?p=999#comment-218 With regard to point number one, you might have to rethink your argument. The overwhelmingly vast majority of all Americans are completely dependent upon imported food. Virtually all Americans living in metropolitan areas are completely dependent upon imported food. Americans have forgone the security gained by growing their own food and made themselves dependent upon others for their own survival; they've decided that they could do better by devoting their time and energy to labor that produces more value and trade for food (and other things that are even more important than food - like water). And yet, life goes on. In fact, the net result of increasing dependency upon others for food is not hunger, but rather widespread obesity. Your argument, however, is that all of those Americans ought to stop making comparative advantage decisions (whether consciously or, what is far more likely to be the case, subconsciously) and quit their day (or night) jobs and move out of the cities and burbs and start their own little farm (they won't be able to maintain the kind of farm that will produce all of their food stuffs needs in the city or the burbs). After all, there's little difference between a nation of individuals being dependent upon another nation for necessary food stuffs and an individual being dependent upon another far-away individual for his necessary food stuffs. Both have put themselves at considerable risk by depending upon speculators, unscrupulous businesses, and corrupt and inept politicians and bureaucrats. Comparative advantage is applicable to agriculture. It just doesn't seem that way because of politicians and bureaucrats who've messed things up. While we don't enjoy anything close to a free market in agriculture in this country, it's certainly freer than what exists in many other countries that have experienced (or are experiencing) huge food shortages. Are Mexicans and Central and South Americans and Africans worse off because of the trade agreements that they've made with the US? Sure, but that's largely the fault of the trade agreements. They're openly competing in a labor- and capital-intensive market that depends upon prior knowledge with a country that protects its own market against those very people and floods those nations with under-priced products. It's very likely that they would be better-off and that we would be just as well-off if we threw down the barriers to competition (just as people in Michigan are better off for being able to freely trade with Californians and how New Yorkers are better off for being able to freely trade with Floridians). With regard to point number one, you might have to rethink your argument.

The overwhelmingly vast majority of all Americans are completely dependent upon imported food. Virtually all Americans living in metropolitan areas are completely dependent upon imported food. Americans have forgone the security gained by growing their own food and made themselves dependent upon others for their own survival; they’ve decided that they could do better by devoting their time and energy to labor that produces more value and trade for food (and other things that are even more important than food – like water). And yet, life goes on. In fact, the net result of increasing dependency upon others for food is not hunger, but rather widespread obesity.

Your argument, however, is that all of those Americans ought to stop making comparative advantage decisions (whether consciously or, what is far more likely to be the case, subconsciously) and quit their day (or night) jobs and move out of the cities and burbs and start their own little farm (they won’t be able to maintain the kind of farm that will produce all of their food stuffs needs in the city or the burbs). After all, there’s little difference between a nation of individuals being dependent upon another nation for necessary food stuffs and an individual being dependent upon another far-away individual for his necessary food stuffs. Both have put themselves at considerable risk by depending upon speculators, unscrupulous businesses, and corrupt and inept politicians and bureaucrats.

Comparative advantage is applicable to agriculture. It just doesn’t seem that way because of politicians and bureaucrats who’ve messed things up. While we don’t enjoy anything close to a free market in agriculture in this country, it’s certainly freer than what exists in many other countries that have experienced (or are experiencing) huge food shortages. Are Mexicans and Central and South Americans and Africans worse off because of the trade agreements that they’ve made with the US? Sure, but that’s largely the fault of the trade agreements. They’re openly competing in a labor- and capital-intensive market that depends upon prior knowledge with a country that protects its own market against those very people and floods those nations with under-priced products. It’s very likely that they would be better-off and that we would be just as well-off if we threw down the barriers to competition (just as people in Michigan are better off for being able to freely trade with Californians and how New Yorkers are better off for being able to freely trade with Floridians).

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