- Agricultural Extension
The term extension was first used in the United States of America in the first decade of this century - Agricultural Marketing &
to connote the extension of knowledge from the Land Grant Colleges to the farmers through the - Agricultural Legislation
process of informal education.In India, the terms community development & extension education - Agricultural Engineering
became more popular with the launching of Community Development Projects in 1952 & with the
establishment of the National Extension Service in 1953. Since then, Community development has
been regarded as a programme for an all-round development of the rural people, & extension
education as the means to achieve this objective.
Extension education is an applied behavioural science, the knowledge of which is applied to bring
about desirable changes in the behavioural complex of human beings usually through various
strategies & programmes of change & by applying the latest scientific & technological innovations.
Extension education has now developed as a full-fledged discipline, having its own philosophy,
objectives, principles, methods & techniques which must be understood by every extension worker
& others connected with the rural development. It might be mentioned here that extension
education, its principles, methods & techniques are applicable not only to agriculture but also to
veterinary & animal husbandry, dairying, home science, health, family planning, etc. Based upon
its application & use, various nomenclatures have been given to it, such as agricultural extension,
veterinary & animal husbandry extension, dairy extension, home science extension, public health
extension, & family planning extension.
DIFFERENCES BETWEEN FORMAL EDUCATION & EXTENSION EDUCATION
It may, however, be mentioned here that when extension education is put into action for educating
the rural people, it does not remain formal education. In that sense, there are several differences
between the two. Some of these differnces are:
Formal education Extension education
1. The teacher starts with
1. The teacher (extension worker) starts with
theory & works up to
practicals & may take up theory later on.
2. Students study subjects. 2. Farmers study problems.
3. Students must adapt 3. It has no fixed curriculum or course of
themselves to the fixed study & the farmers help to formulate the
curriculum offered. curriculum.
4. Authority rests with the
4. Authority rests with the farmers.
5. Class attendance is
5. Participation is voluntary.
6. Teacher instructs the 6. Teacher teaches & also learns from the
7. Teaching is only through
7. Teaching is also through local leaders.
8. Teaching is mainly vertical.8. Teaching is mainly horizontal.
9. The teacher has more or 9. The teacher has a large & heterogeneous
less homogeneous audience. audience.
10. It is rigid. 10. It is flexible.
11. It has freedom to develop programmes
11. It has all pre-planned &
locally & they are based on the needs &
expressed desires of the people.
12. It is more practical & intended for
12. It is more theoretical. immediate application in the solution of
Objectives of extension education. The objectives of extension education are the expressions of
the ends towards which our efforts are directed. In other words, an objective means a direction of
movement. Before starting any programme, its objectives must be clearly stated, so that one
knows where to go & what is to be achieved. The fundamental objective of extension education is
the development of the people.
Agricultural extension in our country is primarily concerned with the following main objectives:
(1) The dissemination of useful & practical information relating to agriculture, including improved
seeds, fertilisers, implements, pesticides, improved cultural practices, dairying, poultry,
(2) the practical application of useful knowledge to farm & home;and
(3) thereby ultimately to improve all aspects of the life of the rural people within the framework of
the national, economic & social policies involving the population as a whole.
Principles of extension education. The extension work is based upon some working principles &
the knowledge of these principles is necessary for an extension worker. Some of these principles,
as related to agricultural extension, are mentioned below.
1. Principle of interest & need. Extension work must be based on the needs & interests of the
people. These needs & interests differ from individual to individual, from village to village, from
block to block, & from state to state &, therefore, there cannot be one programme for all people.
2. Principle of cultural difference. Extension work is based on the cultural background of the people
with whom the work is done. Improvement can only begin from the level of the people where they
are. This means that the extension worker has to know the level of the knowledge, & the skills of
the people, methods & tools used by them, their customs, traditions, beliefs, values,etc. before
starting the extension programme.
3. Principle of participation. Extension helps people to help themselves. Good extension work is
directed towards assisting rural families to work out their own problems rather than giving them
ready-made solutions. Actual participation & experience of people in these programmes creates
self-confidence in them & also they learn more by doing.
4. Principle of adaptability. People differ from each other, one group differs from another group &
conditions also differ from place to place. An extension programme should be flexible, so that
necessary changes can be made whenever needed, to meet the varying conditions.
5. The grass roots principle of organisation. A group of rural people in local community should
sponsor extension work. The programme should fit in with the local conditions. The aim of
organising the local group is to demonstrate the value of the new practices or programmes so that
more & more people would participate.
6. The leadership principle. Extension work is based on the full utilisation of local leadership. The
selection & training of local leaders to enable them to help to carry out extension work is essential
to the success of the programme. People have more faith in local leaders & they should be used to
put across a new idea so that it is accepted with the least resistance.
7. The whole-family principle. Extension work will have a better chance of sucess if the extension
workers have a whole-family approach instead of piecemeal approach or seperate & unintegrated
approach. Extension work is, therefore, for the whole family, i.e. for male, female & the youth.
8. Principle of co-operation. Extension is a co-operative venture. It is a joint democratic enterprise
in which rural people co-operate with their village, block & state officials to pursue a common
9. Principle of satisfaction. The end-product of the effort of extension teaching is the satisfaction
that comes to the farmer, his wife or youngsters as the result of solving a problem, meeting a need,
acquiring a new skill or some other changes in behaviour. Satisfaction is the key to sucess in
extension work. "A satisfied customer is the best advertisement."
10. The evaluation principle. Extension is based upon the methods of science, & it needs constant
evaluation. The effectiveness of the work is measured in terms of the changes brought about in the
knowledge, skill, attitude & adoption behaviour of the people but not merely in terms of
achievement of physical targets.
1 Technological Change in Agriculture and Poverty Reduction
Concept paper for the WDR on Poverty and Development 2000/01
Alain de Janvry, Gregory Graff, Elisabeth Sadoulet, and David Zilberman
University of California at Berkeley
I. The challenge for agricultural technology
The challenge for developing country agriculture in the next 25 years is enormous, particularly if
it is not only to satisfy the growing effective demand for food, but also help reduce poverty and
malnutrition, and do it in an environmentally sustainable fashion. Due to population growth and rising
incomes, demand in the developing countries is predicted to increase by 59% for cereals, 60% for roots and
tubers, and 120% for meat over this period (Pinstrup-Andersen, Pandya-Lorch, and Rosengrant, 1997).
This increased supply cannot come from area expansion since that has already become a minimal source of
output growth at a world scale, and a negative source in Asia and Latin America. Neither can it come from
any significant expansion in irrigated area due to competition for water with urban demand and rising
environmental problems associated with chemical run-offs. While it will thus need to come from growth in
yields, the growth rate in cereal yields in developing countries has been declining from an annual rate of
2.9% in 1967-82 to 1.8% in 1982-94, which is the rate needed to satisfy the predicted 59% increase in
cereals over the next 25 years. The growth in yields cannot consequently be let to fall below this rate in
developing countries without increasing the share of food consumption that is imported. With 1.3 billion
people in absolute poverty (earning less than $1 per day) and 800 million underfed in the developing
countries (World Bank, 1997), agriculture should also have a major role to play in poverty reduction,
particularly since three quarters of these poor and underfed live in the rural areas where they derive part if
not all of their livelihoods from agriculture as producers or as workers in agriculture and related industries.
The real income of poor consumers also importantly depends on the price of food.
If poverty is to fall and the nutritional status of the poor is to improve at the current levels of food
dependency, the decline in growth rate in yields will have to be stopped, and yield increases compared to
current trends will have to occur in part in the fields of poor farmers and will have to generate employment
opportunities for the rural poor. Since the growth rate in yields achieved with traditional plant breeding
and agronomic practices has been declining, the next phase of yield increases in agriculture will have to
rely on the scientific advances offered by biotechnology. Yet, while biotechnology has made impressive
progress in the agriculture of some of the more developed countries, it has had little impact in most
developing countries, and particularly in the farming systems of the rural poor. The objective of this paper,
therefore, is to explore under what conditions could the current biotechnological revolution in agriculture
be helpful for reducing poverty in developing countries. Failure to capture this potential would further
increase the income gap between developed and developing nations and would be a serious setback in the
struggle to reduce poverty.
II. The potential of agricultural technology for poverty reduction
2.1. Direct and indirect effects of technology on poverty
There are two channels through which technological change in agriculture can act on poverty. First, it can
help reduce poverty directly by raising the welfare of poor farmers who adopt the technological innovation.
Benefits for them derive from increased production for home consumption, more nutritious foods, higher
gross revenues from sales deriving both from higher volumes of sales and higher unit value products, lower
production costs, lower yield risks, lower exposure to unhealthy chemicals, and improved natural resource
Second, technological change can also help reduce poverty indirectly through the effects which
adoption, by both poor and non-poor farmers, has on:
The price of food for net buyers.
Employment and wage effects in agriculture.
Employment and wage effects in other sectors of economic activity through production,
consumption expenditures, and savings linkages with agriculture, lower costs of agricultural raw
materials, lower nominal wages for employers (as a consequence of lower food prices), and
foreign exchange contributions of agriculture to overall economic growth.
Through the price of food, indirect effects can benefit a broad spectrum of the national poor, including
landless farm workers, net food buying small holders, non-agricultural rural poor, and the urban poor for
whom food represents a large share of total expenditures. Indirect effects via employment creation are
important for landless farm workers, net labor selling small holders, and the rural non-agricultural and
urban poor. Hence, the indirect effects of technological change can be very important for poverty reduction
not only among urban households, but also in the rural sector among the landless and many of the landed
When are there trade-offs in technology between achieving direct and indirect effects? Within a
given agro-ecological environment, if land is unequally distributed and if there are market failures,
institutional gaps, and conditions of access to public goods that vary with farm size, then optimum farming
systems will differ across farms. Small farmers will typically prefer new farming systems that are more
capital-saving and less risky while large farmers would prefer new farming systems that are more labor
saving and they can afford to assume risks. In this case, heterogeneity of farming systems prevails and there
will exist trade-offs between achieving indirect and direct effects if budget constraints in research requires
priority setting. The more unequally land is distributed and the more market, institutional, and government
failures are farm size specific, the sharper the trade-off will be.
The relative magnitude of the direct and indirect effects of technological change in agriculture on
poverty can be quantified through computable general equilibrium (CGE) models (Sadoulet and de Janvry,
1992). In these models, the direct effects include the change in agricultural profit, the changing opportunity
cost of home consumption of own production, and the change in self-employment on own farm. The
indirect income effect comes from changes in nominal income from all sources other than own agricultural
production. The indirect price effect comes from the change in prices, excluding the effect through the
opportunity cost of home consumption.
Table 1 presents results from models representing archetypal poor economies in Africa, Asia, and
Latin America. They show that the relative magnitude of these effects vary widely according the structure
of the economy, the sectoral incidence of poverty, and the sources of income for the poor. In a typical
African context where the agricultural sector is large and the bulk of the poor are smallholders, direct
effects are very important: they account for 77% of the income gains for the rural poor and for 58% of the
income accrued to all poor. Targeting technological change on poor farmers, with their particular crops,
farming systems, market failures, institutional gaps, and public goods deficits is thus essential for aggregate
poverty reduction. In Asia, by contrast, where most of the poor are rural landless, income gains for the
rural poor derive mainly (64%) from indirect effects captured on the labor market. Of the total income
gained by the poor, 74% is from indirect effects. Hence, targeting technological change toward
employment creation is in this case fundamental for poverty reduction. Finally, in Latin America, where
poverty is largely urban and a majority of the land is concentrated in the hands of large farmers, the rural
poor derive 73% of their real income gains through indirect effects, mainly captured through falling food
prices. The total real income gains captured by the poor derive mainly (86%) from indirect effects. In this
case, the main role of technological change is consequently to lower the price of food, and this will have to
occur principally in the fields of the large farmers. Clearly, at higher levels of geographical disaggregation,
direct effects may also dominate in specific Asian and Latin American regions, requiring region-specific
targeting of research budgets across innovations producing either direct or indirect effects.
If there are trade-offs between direct and indirect effects, care must be taken to allocate research
budgets optimally between these effects to maximize poverty reduction. While little formal analysis has
been made of these trade-offs, optimum allocation needs to be determined for each nation and
agroecological region for which research programs are organized.
2.2. Technology and rural development
Technology offers a huge potential for poverty reduction in small holder agriculture. However, other
potentially cheaper and faster sources of income gains have not been exhausted, particularly through
institutional and policy changes, e.g., greater access to productive assets, improved property rights and
contracts in accessing land, more effective agrarian institutions in support of productivity growth such as
microfinance, infrastructure investment and service coops to reduce transactions costs in accessing markets,
and policies that do not discriminate against agriculture and poor farmers. Hence, to be effectively used for
poverty reduction, the technology instrument needs to be embedded within a comprehensive rural
development and poverty reduction strategy that weights the effectiveness of this instrument against other
III. Agricultural technology and poverty in a historical perspective
The history of technological change in developing country agriculture is one where farmers and
farming communities have historically been the main innovators, followed by the public sector which
released the technology of the Green Revolution as a public good, and subsequently the private sector when
changes in intellectual property rights (IPR) legislation allowed to capture returns from research in biology,
unleashing a new wave of biotechnological innovations as private goods.
3.1. Green Revolution
The Green revolution started with the release of hybrid maize in the United States in the 1950s. It was
extended to the developing countries with the introduction of semi-dwarf varieties of rice and wheat in the
mid-1960s. The Green Revolution in developing countries can be decomposed into two epochs:
Green Revolution I (1965-1975): The main purpose of research was to achieve rapid increases in yields
through high yielding varieties (HYVs), and success was immense, creating large indirect effects for the
poor via declining staple food prices and rising employment in agriculture and related activities. Direct
poverty reduction effects were, however, small and often negative: HYVs were designed for the best areas
(irrigation, high soil fertility) with chemical intensive technology (Byerlee, 1996). They consequently
diffused first among commercial farmers, sometimes with backlash effects on non-adopting poor farmers
through falling prices. GR I also often had negative environmental effects through genetic erosion and
Green Revolution II (1975-today): Research was aimed at the broadening of desirable traits to consolidate
yield gains and to extend the benefits of the GR to other crops, areas, and types of farmers. This allowed
the increase of pest and drought resistance. The benefits of the GR were thus extended toward rainfed areas
(Beyerlee and Moya, 1993) and small farmers, enhancing direct effects on poverty. These technological
innovations were, however, not able to prevent a steady decline in the growth of yields, reducing the pace
of gains in poverty reduction through indirect effects compared to Green Revolution I.
3.2. Scientific revolution and intellectual property rights
There are three major scientific developments that are creating new openings for technological
change in agriculture: the information technology revolution that opened the field of precision farming, the
better understanding of ecological systems that underlies production ecology, and the gene revolution that
launched biotechnology. While intellectually separate, these three technological advances should be seen
as complementary in the domain of applications.
i) Precision farming is an application of the information revolution to agriculture (Wolf and
Buttel, 1996). It is based on information derived from global positioning satellite systems and electronic
monitoring, and processed through the geographical information system. This allows to take into account
the heterogeneity of farmers’ fields in space and time, and to adapt cultural practices to heterogeneity
through variable rates in planting, chemical applications, and irrigation, and though just-in-time application
of treatments. Increased precision is applied to the use of the traditional technologies of agriculture:
chemical fertilizers, synthetic pesticides, tractor-based mechanization, and genetically uniform HYVs. Fine
tuning in the use of these technologies has allowed to postpone decreasing returns and to reduce pollution
when there was overuse.
In the industrialized countries, precision farming allows to deal with heterogeneity in spite of
scale, recuperating the informational advantages of small scale farming at a larger scale. Hence,
information technology has been used to disaggregate heterogeneous large scale farms into locationally
differentiated management practices. In the developing countries, information technology has been used to
aggregate heterogeneous small scale plots into homogenous (spatially disconnected) mega-environments to
which common technological practices can be applied. While monitoring in the industrialized countries is
done at the farm level, it is done through centralized services in developing countries such as weather
stations, satellite monitoring of biomass, and regional intelligence on insect infestations.
ii) Production ecology uses the concept of agroecosystem as the unit of analysis (Harwood, 1998).
Such systems are characterized by complex biological processes and relationships through which a
multitude of species interact. Production ecology starts from the analysis of these processes, and defines a
set of interventions to modify them to achieve desirable outcomes. Interventions thus include the
management of carbon flows and biota, increased nutrient cycling from soil to crops, integrated pest
management and ecologically-based pest management, diversified farming with crop rotations and multiple
cropping, the provision of ecosystem services (hydrological cycling, wildlife habitat, preservation of animal
and plant diversity, and landscape management), and use of carbon sinks to improve atmospheric chemical
balance. The approach has been successfully pursued in agroforestry systems (e.g., by ICRAF, the
International Center for Research on Agro-Forestry) and agroecology for smallholders (e.g., by CLADES).
Except in the organic agriculture movement, it has not yet gained mainstream recognition but offers
iii) Biotechnology is based on the understanding of how biological organisms function at the
molecular level, and manipulation of the DNA molecules from which genes are made to achieve desirable
outcomes (Kendall et al., 1997). It includes genomics (the identification of genes), functional genomics
(the characterization of how genes work), bioinformatics (data banks on genomics), marker-assisted
selection to speed traditional breeding, plant and tissue culture, the transfer of genes across species to
confer useful traits to the genetically modified organisms (GMOs), diagnostic kits for identification of plant
and animal pathogens, and vaccine technology. Biotechnology started 25 years ago with the discovery of
scientific procedures to alter DNA sequences. With introduction of intellectual property rights in biology,
it has become a booming field of research with already extensive applications to agriculture.
IV. Main features of agbiotechnology for the poor
4.1. Traits: potentials and risks
The advent of biotechnology offers the possibility of amplifying the achievements of traditional breeding in
Green Revolution II for three reasons:
(1) Broadening of the spectrum of potential new products and traits through genetic engineering
(recombinant DNA techniques, insertion of genetic materials) of plants and animals: wide crossings (genes
transfers from wild relatives of the crop) and transfers of foreign genes (gene transfers across species).
(2) Acceleration of the pace of plant breeding through use of selectable gene markers, promoters,
and new scanning devices.
(3) Cheapening of research due to productivity gains in research.
For smallholders, the GMO technology offers the possibility of using gene transfers to insert into
the best plant varieties they use a number of desirable traits which these varieties do not have. For the
poor, GMO technology offers both potential benefits and risks. Some of the most important are the
Potential benefits of agbiotechnology for poverty reduction
- Yield increases in staple food crops produced in tropical and semi-tropical environments, and in peasant
- Area expansion toward less favored lands: tolerance to acid soils, saline soils, aluminum soils;
tolerance to droughts.
- Multiple cropping: shorter maturation period.
- Cost reduction via resource-saving effects: nitrogen fixation, low nitrogen tolerance, chemicalsaving.
Possibility of exact reproduction of seeds by farmers (apomixis).
- Risk reduction: lower susceptibility to biotic stress (insect resistance (e.g., Bt crops) and virus
resistance) and to abiotic stress (droughts, frosts). Diagnostics to detect and identify diseases, for instance
on seeds purchased.
- Improved storability: insect resistance, delayed maturation (reduces marketing costs).
- Nutritional improvements as food and feed: high lysine, improved micronutrient content.
- Health benefits for humans and animals: reduced exposure to chemicals, new vaccines.
- Environmental benefits: reduce application of chemical pesticides, preservation of biodiversity
through gene insertion in a wide range of varieties.
Potential risks of agbiotechnology for the poor
- Staple food crops produced in tropical and semi-tropical environments and by smallholders are
by-passed by research.
- Labor-displacement by diffusion of herbicide tolerant plant varieties.
- Production in MDCs of substitutes for crops previously produced in LDCs, particularly labor
intensive and/or by small holders (trade substitution effect).
- Traits pursued in private sector research are for non-poor consumers: improved industrial
processing, delayed ripening.
- Consumer risks: allergies.
- Environmental risks: insect and virus resistance, gene flows in centers of biodiversity
(superweeds), weediness, destruction of useful insects and species.
- Terminator gene to enforce IPR raises costs by preventing reproduction of seeds.
4.2. Current achievements of agbiotechnology
By contrast to the Green Revolution research that was conducted in the public sector, delivered
international public goods, and occurred purposefully in the developing countries (CGIAR research), most
research in biotechnology has been done in the developed countries, using patents mainly owned by a few
large multinational corporations, on commodities that are principally for animal feed and fiber, and with
traits favorable to large capital-intensive commercial farms and to high income consumers. The data in
Table 3 indicate the global status of this technological revolution as of 1998.
The data show that 75% of the area planted in transgenics is located in the developed countries,
with the USA accounting for 64% of the world total. Herbicide tolerant soybeans and Bt corn (feed) are
the dominant cropxtrait combinations, followed by insect resistant and herbicide tolerant cotton. In
Argentina, by far the developing country (besides China) most advanced in agbiotechnology, the main
transgenics are herbicide tolerant soybeans, Bt corn, and Bt cotton. Hence, the global status of transgenic
crops clearly shows developing countries lagging far behind and the purpose of transgenics directed at nonfood
crops and principally labor-saving technological change. Observation of the frequency distribution of
GMO field trials across countries indicates that several developing countries have advanced research
capacity in DNA techniques, notably China, Argentina, India, Brazil, Mexico, and Egypt, followed by
countries with modest capacity such as Indonesia, the Philippines, and Kenya (Pray, Courtmanche, and
4.3. Main differences between agbiotechnology and GR II for poverty reduction
If the potential offered by agbiotechnology for poverty reduction is to be seized and the risks contained in
the approach are to be avoided, the specificity of the technology and how it is made available need to be
understood in contraposition to the technology of the Green Revolution II, the last important technological
epoch for developing country agriculture. The main differentiating features of agbiotechnology are the
1. Technological features of agbiotechnology
i) Research on traits separated from research on varieties. Compared to traditional breeding (GR I and II)
where research on trait identification was confounded with variety development, biotechnology dissociates
research on traits (functional genomics) from product development (insertion of genes corresponding to
traits into selected varieties). Agbiotech research results on traits may be usable over a wide range of local
conditions. Hence, if information on relevant functional genomics exists and can be accessed through
markets, contracts, or as public goods, and if technology to insert these traits into local varieties is widely
available, developing countries can produce improved varieties without the need to engage in fundamental
research. This has powerful implications for the division of labor in research between developed and
developing countries and the type of capacity building needed in the latter, in this case principally to screen
and adapt these technologies to their own needs.
ii) Potential environmental externalities and consumer risks. New varieties under GR research were
achieved by natural crossings. With GMOs, new species and varieties are created by artificial gene
transfers, with yet poorly known risks for the environment and consumers. As a result, the experimentation
on and the diffusion of agbiotechnology innovations need to be accompanied by specific regulatory
procedures to safeguard environmental and consumer safety, and weight risks against the benefits of the
iii) Biodiversity as the source of research materials. New genes to be inserted in cultivated varieties are
found in the stock of biodiversity. The option value of preserving biodiversity in-situ and ex-situ is thus
enhanced. Incentives to establish property rights over biodiversity and to invest in biodiversity
conservation are thus important side effects of progress in agbiotechnlogy.
2. Role of intellectual property rights
i) IPR and access to biotechnology materials for the LDC. The current patenting system on life forms
allows private appropriation of knowledge on genomics, the basic raw materials of biotech research
(Wright, 1998). There is serious concern that such appropriation will create hurdles for access to the
relevant materials for research in developing countries, public sector institutions, and the CGIAR and for
downstream product development. Some of the patents that have been granted are very broad and they can
be used to block access to discoveries to others. Evolution of patent law is, however, in full progress as it
is still drawn by case law without having been submitted to open national debates. Pressed by public
concerns with biosafety, by governments’ interest in preserving the competitiveness of the industry, and by
the need for World Trade Organization (WTO) members to introduce IPR legislation on life forms, such
debates are likely to occur in the near future, potentially leading to changes in the current IPR system.
ii) Market failures for IPR and industry concentration. A large number of technological innovations are
involved in the development of a final product, and ownership of these innovations is often scattered over
many institutions. Rapid concentration of patent ownership in the corporate sector through acquisitions and
mergers evidences these technological complementarities in product development and existence of serious
market failures in the acquisition of patented materials needed for product development (Graff, Rausser,
and Small, 1999). As the Bt example shows (Figure 2), university and public institutions held 50% of the
stock of patents in 1987, independent biotech companies and individuals held 77% of the stock in 1994,
and the “big 6” held 67% of the stock of patents in 1999. As can be seen from Figure 3, 75% of the patents
controlled by the “big 6” in the industry in 1999 (AstraZeneca, Aventis, Dow, DuPont, Monsanto, and
Novartis) were obtained via acquisitions of subsidiary biotech and seed companies. Concentration fueled
by market failures for IPR shows that LDCs and the CGIAR will have considerable difficulties engaging in
biotech R&D until an effective clearinghouse for the rights to utilize biotech knowledge is available.
iii) Intellectual property rights and access to GMO seeds. Property rights over seeds can be established by
(1) concentrating on hybrid seeds, (2) introducing terminator genes in open pollinated varieties, and (3)
legal enforcement of prohibition to reproduce seeds of open pollinated varieties. Failure to achieve
property rights over seeds via legal enforcement will (1) limit research on biotechnology to hybrids and
terminator-charged varieties, (2) limit insertion of new traits into a broad range of local varieties, implying
sub-optimal seeds for the poor and loss of biodiversity through simplified farming systems, (3) increase
reliance on contract farming by seed producers, with increased concentration of control over the industry,
and (4) raise the price of seeds as producers attempt to recoup the cost of research and development in one
single sale, increasing liquidity constraints for smallholders exposed to credit market failures. However,
IPR raise the cost of seeds for traditional farmers who have historically reproduced their own seeds.
iv) Role of barter in accessing biotechnology. Since biodiversity is the raw material for agbiotech
research, and much of the relevant biodiversity is located in developing countries and peasant farming
communities, granting access to biodiversity to MDC interests can potentially be used as a source of
leverage for bartering access to agbiotech innovations held by these interests. Such barters can apply to
both scientists in developing countries, including the CGIAR, who need access to patented research
materials for their own research, and to farming communities who need access to seeds improved by
3. Research and development on GMO technology in LDCs
i) Current research gaps for the poor. Because agbiotech innovations are generated principally in the
industrialized countries for major crops produced in these countries by a clientele of large farmers with few
market failures and for relatively high income consumers, there are important gaps that need to be filled to
make biotech innovations relevant for poverty reduction in developing countries (Nuffield Foundation,
1999). They include research on staple foods for tropical and semi-tropical environments, labor intensive
technologies, and traits desirable for peasant farming systems that operate under extensive market failures,
institutional gaps, and government biases. Institutional mechanisms need to be devised to fill these
research gaps, including defining the new role of the public sector research institutes and the CGIAR.
ii) Structure of research costs and access by LDCs. Biotech changes the structure of research costs: it
increases the costs of fundamental research, but lowers the costs of product development. If fundamental
research relevant for LDCs and smallholders is done in the MDCs, development of agbiotechnology
products for poverty reduction is made cheaper. If such research is not available, the cost of generating
agbiotechnology products for poverty reduction may be significantly higher than under traditional breeding.
iii) Complementarity between agbiotechnology and traditional breeding. Biotechnological research is
complementary to traditional breeding since the new traits need to be inserted into the best possible local
varieties in order to deliver to farmers the myriad of traits that cannot be controlled by gene transfer. An
effective traditional breeding program thus creates scale effects for biotech research by enabling transfers
of traits to a wide range of improved local varieties.
iv) Complementary roles of public and private research. Many agbiotech innovations have originated in
public sector research and been refined by start-up biotechnology companies. These companies have
generally spun-off from universities, were financed by venture capitalists, and their products were
commercialized by large multinational corporations. Analysis of the granting of patents in agbiotechnolgy
shows the sequential roles of the universities and public sector, the biotechnology firms, and the corporate
sector in research and development. Using Bt technology as a case study (Figure 1) shows that university
and public institutions generated 60% of the patented research in 1976-86, small biotech firms and
individuals 77% in 1987-95, and large corporate firms 55% in 1999. Continued support to public sector
research is thus essential for the flow of innovations to be replenished. For this sequential division of labor
to be effective, linkages between these institutions is important for research to yield useful products,
particularly through offices of technology transfer in universities and public institutions, venture capital for
biotech firms, and efficient trading of property rights across all these institutions.
v) Public-private research partnerships. With some 75% of world investment in agbiotech research
coming from the private sector, the public sector and the CGIAR are increasingly seeking to develop
research partnerships with the private sector (Herdt, 1998). Design of these partnerships is complex since
the objectives of partners are at odds: the private sector pursues profits, while the public sector and the
CGIAR are in principle pursuing the delivery of public goods.
vi) Participation of smallholders to research priority setting on traits. Genetic engineering increases
widely the range of potential new traits for resistance to pests, tolerance to stress, improved food quality,
and environmental sustainability. Some of these traits are favorable to the poor while others offer risks. As
the range of trade-offs rises, who sets priorities for research on traits will be key in determining the impact
of biotechnological innovations on poverty. Failures for the poor to participate to priority setting increases
the risk that they will be bypassed by technological progress.
4. Institutional context for diffusion
i) Trait insertion into local varieties and biodiversity. Biotech allows an increase in the range of varieties
of a crop to which new traits can be applied. Hence, the benefits of research on trait improvement that
were confined to major varieties under GR II have greater potential to be extended to varieties used in
peasant farming systems and in niche farming. If incentives and means can be given for broad insertion
into local varieties, this offers the potential of better serving small holders and preserving biodiversity.
ii) Biosafety regulation with weak institutions. Biotechnolgy takes breeding science into unchartered
territories. Hence, the need for regulation of environmental and food safety effects is enhanced, increasing
the role of the public sector in defining rules and of local communities in monitoring and enforcing them.
Regulation poses a set of specific problems for implementation in developing countries and among large
numbers of poor smallholders. It is also a double edged sword since costly regulatory procedures operate
against smaller biotech firms and against smaller farmers, inducing concentration in industry and farming.
Releasing genetically-engineered crops in developing countries that are centers of origin and diversity of
these crops (such as maize in Mexico, wheat in the Middle East, and potatoes in Peru) creates higher risks
of gene flows in nature and weediness. The need for strict biosafety regulations is consequently greater
precisely where they are more difficult to implement, calling for innovative approaches in institutional
iii) Gene stacking and new farm management. The current state of knowledge in biotech processes only
allows the stacking (pyramiding) of a few traits by gene transfer. Hence, the question of which functions
are to be achieved by gene transfers and which by traditional means (chemical pest management, integrated
pest management, precision farming, production ecology, etc.) needs to be assessed for each particular set
of circumstances. Use of biotechnology in heterogeneous farming conditions requires the ability to
assemble these technological packages for each particular agroecological and socio-institutional
environment, opening the need for a new approach to the science and practice of farm management which
relies importantly on precision farming techniques.
iv) Preventative vs. remedial technologies. Biotechnological control of pests and weeds is preventative
(ex-ante relative to infestations) as opposed to chemical pesticides and herbicides which are remedial (expost).
Hence, optimum use of biotechnology instruments should be planned as part of the total crop
production system, calling upon engaging in integrated crop management (ICM). ICM aims at the joint
management of soil organic matter and structure, pest and disease resistance, and conservation of the
beneficial insect and micro-organism population. Instruments for ICM include use of crop rotations, pest
and disease resistant cultivars, weed and disease free seeds, and complementary pesticides and chemicals.
ICM thus effectively combines agbiotechnology with precision farming and production ecology.
5. Use of GMOs by smallholders
i) Biotechnology, human capital, and effort requirement. By offering “smart seeds” (e.g., plants that selfprotect
with biopesticides or can adapt to stress), agbiotechnology demands less human capital, effort, and
specialized equipment from users than chemicals or integrated pest management. Its relative simplicity
may be a major cause for the very fast rate of adoption in developed countries within the three years since
available. It is a feature clearly favorable to diffusion among developing country smallholders with low
human, physical, and institutional capital endowments.
ii) Structure of production costs and adoption by smallholders. By embodying traits in the seed,
biotechnology changes the structure of costs for farmers from variable costs (e.g., chemical insecticides) to
fixed costs (e.g., seeds with biopesticides). With IPR and greater value added in seeds, these fixed costs
can be sharply increased. While the new technologies can be beneficial in expected value, the changing
cost structure has several implications for adoption by poor farmers: partial and sequential adoption of pest
control is prevented, fixed costs are increased, beginning-of-season liquidity requirements are raised, and
risks are enhanced as seed expenditures are committed irrespective of subsequent stochastic events.
iii) Changing exposure to market failures and institutional gaps at the farm level. Because biotech is
resource saving by contrast to the Green Revolution that was resource deepening, use of GMOs may reduce
exposure to market failures and institutional gaps. The same is true for the risk reducing effects of biotech
that mitigates the cost on smallholders of insurance and credit market failures. However, biotechnology
creates other sources of exposure to market failures by displacing the structure of production costs and
requiring imposition of biosafety regulations.
V. What can be done to use biotechnology for poverty reduction
1. Overall conclusion: the role of institutional innovations
Agricultural biotechnology has great promise for poverty reduction, both through direct and
indirect effects, with considerable flexibility in striking differential balances between these two sets of
effects to reduce aggregate poverty according to country and regional characteristics. Failing to capture
this potential would be both a serious missed opportunity in the struggle against poverty and a risk that the
competitiveness of smallholders in developing countries be further weakened relative to that of other
producers and other countries. As the large gaps in the use of agbiotechnology across countries and the
biases in crop and trait innovations indicate, the current situation is one of massive market and government
failures for potential developing country and smallholder users. However, meeting the institutional
requirements to overcome these failures is highly demanding. The effort to use biotechnology for poverty
reduction will consequently fail or succeed not so much depending on ability to progress in biological
sciences as on the ability to put in place the necessary public and private institutions for the generation,
transfer, delivery, and adoption of biotechnological innovations favorable to poverty reduction. Since weak
institutional development is an integral feature of under-development, and a pro-poor bias in developing
country institutions has been notably lacking, this poses particular difficulties in achieving success that
need to be pro-actively addressed. In what follows, we identify the institutional innovations that are needed
for this purpose.
2. Generation of biotechnological innovations
Institutional requirements to secure the generation of biotechnologically modified crops and
animals with traits favorable to poverty reduction include the following:
i) An IPR regime that does not hamper further research and downstream product development,
particularly for public institutions, international organizations such as the CGIAR, and NGOs that are
concerned with the poor. Questioning the features of current patent systems and guiding their future
evolution should thus be an integral part of efforts to maximize the role of biotechnology for poverty
ii) IPR regimes that recognize the legitimate ownership rights of traditional farming communities
over biological resources and give them leverage in gaining access to the private products of
biotechnology. Experimentation with innovative contracts to reconcile farmers ownership rights over
biodiversity with efficient bio-prospecting is needed (e.g., Shaman pharmaceuticals and INBio in Costa
iii) Development of markets for the trading of patented materials. An efficient clearinghouse,
based on publicly available information, for the rights to utilize patented biotechnology materials and
products is thus essential to protect developing country and smallholder interests.
iv) Use of defensive patents on CGIAR and public sector research innovations that have high
potential for poverty reduction with the purpose of keeping them expressedly in the public domain for
selected clienteles. Due to costs and legal complexities, patents will likely be taken in joint ventures with
the private sector. Identification of best practices for the delivery of IPG under defensive patents is
v) Development of the capacity of the national academic and public sectors to engage in
fundamental research complementary to that of the private sector, to test alternative technological options,
to adapt technology to their own needs, and to engage in product development. The type of national
capacity to be developed thus depends on the particular optimum balance between these functions that
varies by country. This should be pursued on a regional basis for the smaller and poorer countries.
vi) Participation of poor producers in the setting of priorities for applied research and product
development, particularly regarding choice of crops, traits, and farming systems. Effective participation
requires pro-active information campaigns to empower the poor.
vii) Promotion of collaborative arrangements (partnerships, consortia, contract research, gifts)
bringing together corporate, non-profit, public, and international institutions for the development of biotech
products favorable to poverty reduction. Experimentation to identify best practice for these arrangements is
needed (e.g., role of ISAAA, the International Service for the Acquisition of Agri-biotech Applications).
viii) Identify opportunities for technological spillovers from industrialized countries that do not
threaten commercial markets for private sector innovations. Under these conditions, technology transfers
can be handled as gifts (e.g., Monsanto’s virus resistant subsistence potatoes in Mexico).
ix) Enhanced public sector and CGIAR research budgets to work on (1) crops and traits not
addressed by private sector research that are important for the urban and rural poor and (2) a more complete
understanding of developing countries’ ecosystems. Declining real budgets for the CGIAR and NARI
should thus be an issue of concern if the potential of biotechnology for the poor is to be captured.
x) Institutions to link public and CGIAR research to private sector product development through
offices of technology transfer attached to universities and public research institutes, venture capital for the
financing of agbiotech companies, and mechanisms for the fair and effective enforcement of property
xi) Traditional breeding efforts should continue. An increased number of good varieties will
improve the value of traits introduced by biotechnology. Biotech both alters the practice of breeding
through the use of markers and tissue culture and increases the pay-off of breeding by providing better local
varieties for gene insertion.
3. Transfer of technologies and the delivery of products
Institutions to link the results of research to the delivery of products adoptable by developing
country farmers and particularly smallholders include the following:
i) Public and non-profit sector roles in (1) the insertion of new traits in poor farmer crops and
varieties with insufficient market size to provide private sector incentives, (2) the assembly of idiosyncratic
technological packages for smallholder farming that combine traits controlled by gene insertion with
functions delivered by other approaches such as chemical pest management, IPM, and production ecology.
ii) Coordination of private sector initiatives toward market expansion among smallholders,
allowing them to overcome the commons problem typical of such investments.
iii) IPR incentives and availability of low cost technology to insert new traits into a wide range of
alternative varieties, allowing better adaptation to local conditions, preservation of biodiversity, and
competitive farming (as opposed to generalized contracting).
iv) Development of a regulatory framework for biosafety and consumer protection that
corresponds to each country’s preferences for risk and expected income gains, which change with stages of
development. Attempts to equalize regulations affecting agbiotech in the name of harmonization, for
instance to satisfy WTO requirements, should be scrutinized for their impact on the poor.
v) Decentralization of the monitoring and enforcement of biosafety regulations to the community
level, based on community-level cooperation and verification by central agencies.
vi) Focus first on simple technologies with low biosafety risks (e.g., Rhizobium inoculation in
Kenya) for as long as enforcement of regulatory frameworks remain weak.
vii) Discriminatory pricing of genetically modified seeds if market segmentation between poor
and non-poor is possible.
viii) Subsidies to private marketing strategies that promote adoption of new technologies
favorable to poverty reduction.
ix) Promotion of the private sector to deliver integrated services to smallholders combining
GMOs and other technological approaches.
4. Adoption by small holders
Institutions to reduce poverty among smallholders by supporting adoption of favorable
i) Organization of credit schemes to face higher and earlier liquidity requirements in the purchase
of seeds with improved trait content that are protected by IPRs, and potentially subject to non-competitive
ii) Insurance and risk sharing mechanisms to absorb higher risks associated with committed seed
expenses and higher cash outlays.
iii) Development of institutional mechanisms (such as labeling) and production contracts for
identity-preservation of improved small-farmer products.
iv) Promotion of grassroots organizations such as service cooperatives in support of contract
farming with smallholders for the acquisition of information on GMOs, access to modern inputs, and
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Economics and Marketing, Rutgers University.
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Countries: A General Equilibrium-Multimarket Approach”, American Journal of Agricultural Economics
Series No. 12. Washington D.C.: The World Bank.
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Journal of Agricultural Economics, 78(5): 1269-74.
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Property”, California Agriculture 52(6): 8-13.
Agricultural technology continues to change the
way people farm
By Arlene Bachanov
This story appeared in The Daily Telegram's Focus on the Future section on Tuesday, Feb. 24. To read
all the stories in the section, click here.
Some things about farming haven‟t changed since the first farmer, somewhere back in the mists of time,
put some seeds in the ground and waited for the sun and rain to make them grow. But over the last few
years, several new technologies have been developed that greatly affect how a farmer does his work and
how profitable his operation can be, and Lenawee County farmers are among the many who have adopted
these technologies with great results.
“One of the greatest things you‟re seeing now involves satellites,“ said Tom Van Wagner, district
conservationist for the U.S. Department of Agriculture‟s Natural Resources Conservation Service.
Satellite-based GPS systems perform a number of different tasks, including steering the equipment
automatically to reduce overlap and therefore the use of seed, chemicals and fertilizer. Another advanced
technology involves GPS grid-mapping, whereby a field is marked off electronically, the soil in each grid is
sampled to determine its quality, and that data is loaded into an onboard computer that automatically
puts fertilizer only where it‟s needed. That not only improves crop yields, but it cuts costs and helps with
water quality, Van Wagner said.
“Agriculture is big business,” he said. “We sometimes read about agriculture and how (farmers) are
polluting and causing all these problems. But farmers are stewards of the soil. They have to be concerned
about erosion and water quality.”
One of the ways local farmers can see some of the latest technology in action is through the Center for
Excellence program. About 10 or so years ago, Van Wagner said, a group of area farmers saw a need for
on-farm demonstrations to help them see how different products affect yield and assess whether these
techniques would work on their own farms.
One of the hosts of a Center for Excellence plot is Tim Stutzman, who with his father farms 6,300 acres of
corn, beans and wheat near Morenci. Prior to getting involved with that program, he worked with
Monsanto on something similar, so he‟s had about 15 or 16 years to be one of the first people locally to see
what„s new for farmers.
“It gives me a chance to look at new technology firsthand on our farm,” he said. “As a farmer, we‟re always
in school. We‟re always learning. You never do everything perfectly.”
Another Center for Excellence host, and one of the local operations who‟s been heavily involved in these
new technologies, is Bakerlads Farm. Blaine Baker and his brother Kim farm 1,500 acres in the Clayton
area, raising corn, soybeans, alfalfa and milk cows.
“Prices (for commodities) were up last year, so we thought it‟d be a good time to get some new
technology,” Blaine Baker said.
One of the devices he uses is a GPS-based automatic shutoff system that turns the planter on and off
depending on where the field has already been planted. Avoiding double-planting saves on seed costs,
which is important at the best of times and especially critical given the way the price of corn seed has shot
up. “It„s gone from $100 a bag to $300 a bag in three years,” Baker said. Plus, by making sure there aren‟t
too many plants in one place, yield is improved.
The Bakers also use an automatic clutch system that uses grid sampling to improve fertilizer application.
The field is sampled in 2.5-acre grids, the soil is tested in each grid, and the “prescription” for fertilizer is
input into a computer. The rate of application varies according to what‟s needed in each location.
“Say on a 40-acre field, you put 6,000 pounds (of fertilizer) on,” Baker said. “But when you grid-sample,
you might have put 2,000 pounds on.”
The technology is also available to allow farmers to apply variable-rate seed in the same way, Baker said.
The Bakers haven‟t adopted that yet, although Blaine Baker said he thinks they will. By determining where
the soil is best, a farmer can plant more seeds in good soil and fewer in poorer soil, helps yield in both
types of soil. While it‟s obvious that good soil should get more seed, it may sound surprising that planting
fewer seeds in poorer soil actually produces more plants. The reason that can be true, Baker said, is that
the farmer isn‟t putting more seed into the poorer soil than it can support, giving the plants that are there
a better chance.
Yet another technology allows a farmer to map out his or her yield. When they plant, Baker said, they plug
data on what variety of seed they‟re planting and where into the computer, and at harvest time they can
get yield data to determine what varieties did best.
In Hudson, farmer Brent Moore also adopted a number of new technologies last year. Moore and his son
Jacob grow corn and soybeans on about 1200 acres each and about 400 acres of wheat.
“We‟re trying to be good stewards of the soil and of the economy,” he said.
Among the systems the Moores use are the automatic-clutch technology that turns the planter on and off
depending on where in the field it is, the grid-sampling system for nutrient application, and the yield
monitor that tracks the seed varieties planted and how well they do. They also use an AutoSteer system,
which among other things uses GPS technology to keep the planter going in a straight line, improving
efficiency. “The shortest distance from Point A to Point B is a straight line,” Moore said, and AutoSteer
allows him and his son to plant more acres per hour.
According to Bill Copeland, an agent with Precision Ag Services in Wauseon, Ohio, AutoSteer saves a
farmer about 10 percent a day in time. And, because it allows the farmer to not worry about looking for
rocks and not think about missing or repeating spots, “you‟ll take a lot of stress off you.”
“Once (farmers) go to it, they don‟t want to be without it,” he said.
Farm equipment‟s GPS technology can have as close to pinpoint accuracy as there is. The level of accuracy
depends on the GPS system being used, but Moore said that his system is accurate to within about an
inch. “That‟s probably the most amazing thing I‟ve ever come across,” he said.
Moore does admit that taking the plunge into the new equipment wasn‟t exactly easy. “I was the one who
dragged my feet,” he said. “My wife and son talked me into it.”
And now that he‟s done it, he said, “I‟d recommend it to anyone.”
Farmers who aren‟t especially computer-savvy will find it easy to use, both Moore and Baker said.
“My son read the book and he had it. It took me two or three days to learn with him helping me,” Moore
said. “Anybody who has a beginner‟s level of computer (skill), it‟s easily accomplished in a short amount
“It‟s fairly idiot-proof,” Baker laughed. “Once you get it set up, get all your information into it, it goes
Of course, these systems aren‟t inexpensive. Copeland said that depending on the level of the GPS system
it could run to about $7,000. A yield monitor might cost $4,000, while an automatic sprayer system could
run $2,500. A farmer interested in purchasing the whole range of equipment could easily spend up to
But, the systems pay for themselves over time, depending of course on the investment and the acreage
“You get a return quickly. In some cases, it‟ll pay for itself that year,” Copeland said.
Moore said he knows that such advancements are paying off financially for his operation. What first
enticed him were the five to 10 percent savings on seed costs that the automatic-clutch system promises,
and “I truly believe we‟ve realized a five to seven percent savings,” he said.
More cost savings come thanks to the improved fertilizer management. And the environment is helped
too. “I‟m confident in my mind that we don‟t have any runoff,” he said.
He was told that he‟d make his total investment back in three years. “I actually think it‟s better than that,”
Baker said he, too, knows his new equipment has been well worth it. “We feel pretty comfortable we‟re
getting our money back. The payback is pretty quick,” he said.
Stutzman, who also uses the variable-rate seeding, nutrient application and AutoSteer technologies, said
that because the equipment can be transferred to a new piece of machinery rather than having to be
replaced, he looks at it as a 10- to 15-year investment. And in that time frame with his acreage, “I can
prove to you that I have a savings of around 10 bucks an acre,” he said.
Equipment such as these systems are far from the only technological advancements out there. For
example, Baker said, dairy farmers can use equipment like automatic takeoff units, which remove the
milkers from the cows automatically, and automatic ID systems. Those can track things like how much
milk the cow gives, what the milk‟s temperature is — an indicator of whether or not the cow is feverish —
and what the cow does in the barnyard; if she‟s wandering around a lot, for example, it could be a sign
that she‟s ready to be bred. The system can also route specific cows into different pens by tracking their ID
and closing a gate in front of them as they leave the milking parlor.
As a smaller dairy operation, though, Baker hasn‟t gotten into the automatic ID technology: “We milk 400
cows, and our herdsman is in the parlor quite a bit,” which means he can keep track of things on his own
much more so than a larger dairy farmer could.
Back on the cash crop side, Copeland said one of the new systems that will be tested in the next year uses
sensors that mount on the tractor or boom to monitor the “greenness” of the plant and applies nitrogen
variably based on the amount of sunlight that day and the health of the plant. That will be especially
useful on corn, he said, because that crop needs lots of nitrogen, but it might be tried out on wheat too.
Other things in the works include using cell-phone technology to download field records to the farmer‟s
home computer. And within a year, Copeland said, cell-phone technology will be in widespread use that
improves on GPS by eliminating the current line-of-sight problem.
To Stutzman, one recent technological advancement has had the biggest impact on yields of all: “traited”
seeds, which means that the seeds have been genetically developed for such traits as resistance to specific
pests or resistance to Roundup, allowing a farmer to spray the herbicide on the field and kill the weeds
without harming the crops. Stutzman also said that work is being done on drought-resistant corn and on
ways to make a plant‟s nitrogen use more efficient.
Traited seed is considerably more expensive than regular seed, but “I‟m here to tell you it pays” to use it,
Between the increase in yield and the ability to apply less pesticide and herbicide, the cost-benefit analysis
is very favorable — to say nothing of the fact that it‟s better for the environment and for public health to
put as few chemicals and fertilizers into the soil as possible.
“I don‟t know any farmer that doesn‟t want to leave the land better than he found it, and leave it better for
his kids,” he said.
To Van Wagner, adopting these new technologies isn‟t really up for debate if a farmer wants all the
“You can‟t afford not to have the latest technology in order to be competitive,” he said.
After all, said Stutzman, a lot of what happens in farming is out of the farmer‟s hands anyway, like
weather conditions. “We‟re only in control of about 18 percent of what happens,” he said. “Anything you
can do to improve on that 18 percent is important.”