Economics of diversifi cation of agricultural production in agrarian policy: on the example of the market of organic products
https://doi.org/10.55959/MSU0130-0105-6-58-1-12
Abstract
The article discusses the current problems of the development of organic products market. The theoretical part notes the need to diversify agricultural production not only to maintain income and reduce risks, but also to support soil fertility and high yields, which can also be carried out during the transition to organic farming, when the farmer reduces the level of chemicalization of production in order to reduce externalities. The section of the agricultural policy review analyzes the main factors contributing to the development of organic products market, which include the development of a regulatory framework that creates certain rules and characteristics of organic products, as well as various kinds of subsidies that help both support the production of this type of product and consolidate a certain niche in the market for organic products. The study finds that despite high growth rates of organic market in many developed countries, the profitability of such projects as well as the complexity of the transition from traditional technologies to organic farming is debatable.
Supporting agencies: The article was prepared by the author in the framework of scientifi c research carried out by the author with participation in the research work “Diversifi cation of agricultural production in order to ensure the sustainability of agricultural producers’ incomes and reduce environmental externalities” of the Center for Agro-Food Policy of the IPEI RANEPA as part of the state task (head A. S. Strokov).
References
1. Antczak, E. (2021). Analyzing Spatiotemporal Development of Organic Farming in Poland. Sustainability, 13(18), 10399.
2. Barrett, S. (1991). Optimal soil conservation and the reform of agricultural pricing policies. Journal of Development Economics, 36(2), 167–187.
3. Blakeney, M. (2016). Organic Versus GM Agriculture in the Courtroom in Australia and the USA. In The Coexistence of Genetically Modified, Organic and Conventional Foods (pp. 113–135). Springer, New York, NY.
4. Commission Regulation (EEC) No 4115/88 (1988). Retrieved June 6, 2022, from https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:31988R4115
5. Council Regulation (EEC) No. 2092/91 (1991). Retrieved June 29, 2022, from https://leap.unep.org/countries/eu/national-legislation/council-regulation-eec-no-209291organic-production-agricultural
6. Farming subsidies: Farmers can double their money by going organic under plans to protect nature (2022). Retrieved June 26, 2022, from https://inews.co.uk/news/farming-subsidiesfarmers-double-money-going-organic-protect-nature-1449868
7. FiBL Statistics. (2022). Retrieved June 22, 2022, from https://statistics.fibl.org/
8. Fließbach, A., Fuchs, J., & Mäder, P. (2004).DOK (Biodynamic-Bioorganic-Conventional): Results from 21 Year Old Field Experiment. I International Conference Soil and Compost EcoBiology. September 15th–17th.
9. Goetz, R. U. (1997). Diversifi cation in agricultural production: a dynamic model of optimal cropping to manage soil erosion. American journal of agricultural economics, 79(2), 341–356.
10. Hubbard, K., & Hassanein, N. (2013). Confronting coexistence in the United States: organic agriculture, genetic engineering, and the case of Roundup Ready® alfalfa. Agriculture and Human Values, 30(3), 325–335.
11. Hadar, J., & Russell, W. R. (1974). Diversifi cation of interdependent prospects. Journal of Economic Theory, 7(3), 231–240.
12. Heinze, S., & Vogel, A. (2017). Reversion from organic to conventional agriculture in Germany: An event history analysis. German Journal of Agricultural Economics, 66(6702020-966), 13–25.
13. IFOAM. The Four Principles of Organic Agriculture (2022). Retrieved June 22, 2022, from https://www.ifoam.bio/why-organic/shaping-agriculture/four-principles-organic
14. Johnson, R. (2008, October). Organic agriculture in the United States: Program and policy issues. Congressional Research Service, the Library of Congress.
15. Kniss, A. R., Savage, S. D., & Jabbour, R. (2016). Commercial crop yields reveal strengths and weaknesses for organic agriculture in the United States. PloS one, 11(8), e0161673.
16. Kobylińska, M. (2021). Spatial Diversity of Organic Farming in Poland. Sustainability, 13(16), 9335.
17. Kristensen, E. S. & Alrøe, H. F. (2006). Organic agriculture in a global perspective. In Building Sustainable Communities (pp. 131–144). Brill.
18. Kujala, S., Hakala, O., & Viitaharju, L. (2022). Factors aff ecting the regional distribution of organic farming. Journal of Rural Studies, 92, 226–236.
19. Łuczka, W., Kalinowski, S., & Shmygol, N. (2021). Organic farming support policy in a sustainable development context: A polish case study. Energies, 14(14), 4208.
20. Ma, J., Yu, H., & Luo, X. (2022) Successful experience and policy inspirations of organic agriculture in the United States from the perspective of green development of agriculture, 30(3), 470–483.
21. Marasteanu, I. J., & Jaenicke, E. C. (2019). Economic impact of organic agriculture hotspots in the United States. Renewable Agriculture and Food Systems, 34(6), 501–522.
22. Markowitz, H. M. (1959). Portfolio Selection: Ecient Diversifi cation of Investments. Cowles Foundation Monograph, 16.
23. Mickiewicz, B., & Lisiak, S. (2017). Polish organic farming on the background of the European Union in light of new regulations. Journal of Agribusiness and Rural Development, 43(1), 125–132.
24. Nieberg, H., & Kuhnert, H. (2007). Support policy for organic farming in Germany. Landbauforschung Volkenrode, 57(1), 95.
25. Organic movement calls for increased support for organic farming in CAP strategic plans. (2022). Retrieved June 22, 2022, from https://www.bioecoactual.com/en/2022/03/03/ifoamincrese-cap-support-organic-farming/
26. Paull, J. (2020). Organic food and agriculture. In: Food and Society (pp. 179–199). Academic Press.
27. Pérez-Neira, D., Schneider, M., & Armengot, L. (2020). Crop-diversifi cation and organic management increase the energy effi ciency of cacao plantations. Agricultural Systems, 177, 102711.
28. Podawca, K., & Dąbkowski, N. (2020). Spatial Diversifi cation of Situation of the Organic Farming in the Polish Voivodeships in the Years 2010–2018. Journal of Ecological Engineering, 21(6).
29. Ponisio, L. C., M’Gonigle, L. K., Mace, K. C., Palomino, J., De Valpine, P., & Kremen, C. (2015). Diversifi cation practices reduce organic to conventional yield gap. Proceedings of the Royal Society B: Biological Sciences, 282(1799), 20141396.
30. Pope, R. D., & Prescott, R. (1980). Diversifi cation in relation to farm size and other socioeconomic characteristics. American Journal of Agricultural Economics, 62(3), 554–559.
31. Rodale institute. Farming systems trial (2022). Retrieved June 22, 2022, from https://rodaleinstitute.org/science/farming-systems-trial/
32. Samuelson, P. A. (1967). General proof that diversifi cation pays. Journal of Financial and Quantitative Analysis, 2(1), 1–13.
33. Seufert, V., Mehrabi, Z., Gabriel, D., & Benton, T. G. (2019). Current and potential contributions of organic agriculture to diversifi cation of the food production system. In: Agroecosystem diversity (pp. 435–452). Academic Press.
34. Smoluk-Sikorska, J., & Malinowski, M. (2021). An Attempt to Apply Canonical Analysis to Investigate the Dependencies between the Level of Organic Farming Development in Poland and the Chosen Environmental Determinants. Energies, 14(24), 8390.
35. Springmann, M., & Freund, F. (2022). Options for reforming agricultural subsidies from health, climate, and economic perspectives. Nature communications, 13(1), 1–7.
36. Stolze, M., & Lampkin, N. (2009). Policy for organic farming: Rationale and concepts.Food policy, 34(3), 237–244.
37. The World of Organic Agriculture: statistics & emerging trends (2022). Retrieved June 22, 2022, from https://www.fibl.org/fileadmin/documents/shop/1344-organic-world-2022.pdf
38. Tiedemann, T., & Latacz-Lohmann, U. (2013). Production risk and technical effi ciency in organic and conventional agriculture–the case of arable farms in Germany. Journal of Agricultural Economics, 64(1), 73–96.
39. Thorsøe, M., & Noe, E. (2016). Cultivating Market Relations — Diversifi cation in the D anish Organic Production Sector Following Market Expansion. Sociologia Ruralis, 56(3), 331–348.
40. Wiśniewski, Ł., Biczkowski, M., & Rudnicki, R. (2021). Natural potential versus rationality of allocation of Common Agriculture Policy funds dedicated for supporting organic farming development — Assessment of spatial suitability: The case of Poland. Ecological Indicators, 130, 108039.
41. Goals to Transform Our World. Goal 2: Zero Hunger (2022). Retrieved June 22, 2022, from https://www.un.org/sustainabledevelopment/hunger/
Supplementary files
Review
For citations:
Surpkelova A. Economics of diversifi cation of agricultural production in agrarian policy: on the example of the market of organic products. Moscow University Economics Bulletin. 2023;(1):256-273. (In Russ.) https://doi.org/10.55959/MSU0130-0105-6-58-1-12
Views:
308
Email this article 