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Arguments - Intervention Costs
Science and Technology in Agriculture, Livestock Production, and the Food Industry
We have found no specific information on how much additional scientific and technological modernization of China's agriculture and food industry would cost in monetary terms. Many studies, however, have shown that, in the past, investment in science and technology usually pays off with multiple direct and indirect benefits to society (seeThirtle and Bottomley, 1988; Fan, 1991 and 1997). Knowledge is the ultimate resource for overcoming many natural constraints, particularly in the field of food production. An excellent example is the "Green Revolution," which was basically driven by (scientific) advances in plant and animal breeding and by a better understanding of relationships between plant growth, irrigation, and soil conditions. While many Western scholars in the 1960s and 1970s denounced these worldwide efforts to improve crops and livestock, it is now clear that the program has been the single most important step in feeding the current world population of 5.6 billion. The Consultative Group on International Agricultural Research (CGJAR), with its associated breeding centers and research stations worldwide, was - and is - at the center of these efforts (see our Web links). In principle, four types of costs have to be taken into account.
WB00860_.gif (262 bytes) First, there are the direct costs of building up or improving scientific infrastructure focused on agriculture and food-related research. This includes training researchers, constructing laboratories and research stations, and conducting specific research projects.
WB00860_.gif (262 bytes) Second, there might be indirect costs related to the potential risk of advanced research in fields such as plant genetics. Genetically modified plants and animals might affect the current plant and animal species when they are released to the environment in experimental fields. These "new" plants and animals might, in the long run, also harm the people and animals that eat them. While these dangers are usually dramatized in public discussions, some minimal risks (and costs) cannot be excluded, even when strict precautions are taken.
WB00860_.gif (262 bytes) Third, we know that the implementation of high-technology agriculture and livestock production usually entails substantial secondary costs that have to be met by the farmers before they can enjoy the benefits. These include investments in machinery, irrigation, fertilizers, crop sanitation products (such as pesticides, fungicides, weed killers), soil testing, and harvest processing. Advanced livestock production has already become a high-technology industry: when production units have tens of thousands of animals, one needs costly monitoring facilities, feeding machinery, pharmaceuticals, and highly trained experts to keep the livestock healthy.
WB00860_.gif (262 bytes) A fourth category of costs is associated with the rural labor market. Additional rapid modernization of agriculture and livestock production in China would release millions of manual laborers in the rural areas. This would fuel rural-urban migration in the best case and cause widespread social unrest in the worst case. These "social" costs might be the most dramatic consequence of a scientific and technological revitalization of China's agricultural sector.
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China's past investment in agricultural research
The World Bank has estimated that China had an agricultural productivity growth of some 20% between 1965 and 1994 (World Bank, 1997, p. 15). Fan has shown that the internal rate of return to agricultural research over the same period was about 94% (Fan, 1996). The World Bank argues that this high rate of return means that China is underinvesting in agricultural research. As Figure C85_1 shows, national agricultural research investments in China have increased in real terms from 644 to 2,063 million yuan. However, investments per researcher have declined from 46,001 to 33,276 yuan.
These data give support to our argument that streamlining China's scientific research institutions would probably improve agricultural research.
Central Government Investments in Agricultural Research
Related Arguments

Science & Technology:   Trends     Impact    Data Quality    Prediction Error    Intervention Possibilities    Intervention Costs