Browsing by Subject "Transaction costs"

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Activating institutional innovations for hunger and poverty reduction : potential of applied international agricultural research
(2015) Kamanda, Josey; Birner, Regina
The CGIAR system has made several attempts to improve its organizational structure, the latest being a reform process initiated in 2009. A key issue that has been debated over the years is how the CGIAR centres are best placed within the range of institutions involved in agricultural research and development. The CGIAR still faces the unresolved dilemma between a focus on upstream research that produces international public goods versus downstream activities that ensure impact. Therefore, there is a need to review the CGIARs position on this important question, and to obtain the views of centre scientists and other actors on this question. It is equally important to develop objective approaches to assess the comparative advantage of the CGIAR within the spectrum from upstream research on IPGs to downstream technology dissemination, taking context-specific factors, such as national capacities into account. Case studies are suitable to better understand what works in diverse circumstances and the conditions that have, so far, driven centres to engage in downstream activities. To fill these knowledge gaps, this study used a comparative qualitative case study approach focusing on the legume breeding program of the International Crops Research Institute for the Semi-Arid Tropics (ICRISAT). The studies were conducted in India, Malawi and Ethiopia, a set of countries that makes it possible to study variation in the capacity of national systems. Data was gathered using a combination of methods including a participatory mapping technique called Net-map, expert opinion interviews and a review of relevant documents. Respondents were purposively selected and included ICRISAT scientists, national partners, non-governmental organizations (NGOs), seed corporations, male and female farmers and other stakeholders involved in the research and promotion of improved groundnut and chickpea varieties. The narrative policy analysis confirms that there are contrasting views on whether the CGIAR should primarily focus on the production of IPGs, or also conduct more uptake-oriented activities. The dominant story is that the IPG concept is ideal for framing CGIAR research in a niche that would not be served by the private sector or national systems. The counterstory is that the CGIAR can only achieve impact if attention is paid to both research and development-oriented activities. In view of these contrasting views, which cannot easily reconciled, there is a need to develop objective and practical criteria for assessing the comparative advantage of the CGIAR, taking context-specific factors into account. Using the case studies to illustrate the transactions involved in the development and uptake of technologies, propositions are derived regarding the attributes of transactions for which international agricultural research centres (IARCs) have a comparative advantage over national systems. The analysis indicates that basic and strategic research transactions, such as molecular breeding, have high economies of scale and spillover potential and should ideally be carried out by IARCs. On the other hand, adaptive research, promotion and seed multiplication transactions have low economies of scale and spillover potential and should therefore be ideally assigned to national systems. Besides these two attributes, which are also highlighted in the literature on international public goods, the analysis revealed that transaction intensity and the scope for elite capture and corruption also influence the comparative advantage of the CGIAR centres. Applying this normative framework to the case studies, the influence of contextual factors, especially capacity of national systems, emerges as critical factor. Even though the legume varieties developed by ICRISAT fitted agro-ecological conditions in the target countries, the adoption of these varieties was hampered by institutional constraints. All legumes varieties included in the case studies remained “on the shelf” after their release until ICRISAT got itself involved in seed production and promotion. Capacity building in national systems should be an important role of the CGIAR to ensure that improved varieties are sustainably adopted on a large scale. However, organizations that fund development were found to have a tendency to avoid the difficult and long-term task of capacity strengthening of national systems, and instead use the centres to fill the capacity gaps, which induced the centers to engage in downstream activities. Decision-making and resource allocation for research under the CGIAR Research Programs (CRPs) should therefore take into account the issue of NARES capacity. The centers should constantly assess capacities of national systems to carry out activities that will enable impact in their target locations, and for their mandate crops. Finally, the centres should also manage learning from their involvement in research, as well as complementary activities.
An economic analysis of the implementation options of soil conservation policies
(2008) Schuler, Johannes; Dabbert, Stephan
The objective of this study is to analyze the economic and agricultural aspects of the implementation of soil conservation programmes and to suggest appropriate measure-instrument combinations for efficient soil conservation as a decision support for the implementation of soil conservation policies. Emphasis is given to the resource and institutional economics of soil conservation. In the empirical part, the efficiency of policy options is analysed using the example of a region in north-eastern Germany based on model calculations. After an introduction to the topic of soil functions and soil degradation definitions, the implementation concepts for soil protection measures at the international and national level are described. Based on the theoretical economic analysis of soils as a natural resource, the existing property rights, the public good characteristics of soils and the resulting externalities lead to the conclusion that market failure does exist. Therefore, the non-market coordination of soil use is justified. A cost-effectiveness analysis was derived based on the theory of ?safe-minimum-standard? for the appropriate assessment of the implementation options of soil conservation policies. A fuzzy-logic-based method, which is based on an expanded Universal Soil Loss Equation approach (USLE), was applied for the assessment of soil erosion risk in the sample region. The approach considers both the natural conditions and the characteristics of the cropping practice. The very detailed description of the cropping practices allowed for the specific assessment of erosion relevant effects. This, in combination with the high detail site descriptions provided this study with a very precise regional approach. The regional decision-support system MODAM (multi-objective decision support tool for agro-ecosystem management) was applied for the assessment of the economic and environmental impacts of different policy options. The policy scenarios examined include a CAP reform scenario with decoupled payments in accordance with the proposed conditions of the year 2013. This scenario was used as the reference scenario for the other possible scenarios of soil conservation policies. The three main scenarios for the policy options are 1) a non-spatially oriented, 2) a spatially-oriented incentive programmes for reduced tillage practices and 3) a regulation scenario that prohibits the cultivation of highly erosive crops (row crops) on erodible soils. The prohibition of row crops on highly erodible soils led both to lower on-farm costs and lower budget costs in comparison to the incentive programmes for reduced tillage. All three scenarios had comparable reduction in soil erosion. Based on the modeling results the ban on row crops on highly erodible sites is therefore the preferable option in terms of the cost-effectiveness ratio. The inclusion of transaction costs in this study helps expand the scope of policy analysis, for the total costs of a policy would be underestimated if only the budget costs for the direct payments to farmers were considered. Transaction costs understood as a cost for the (re-) definition and implementation of property rights can reach substantial amounts and reduce the total efficiency of a policy. The results of the qualitative analysis of the transaction costs of the study policy options also supported the option of row crop regulation on highly erodible soils. A model that serves as decision support for both the economic and agricultural aspects of soil conservation had been successfully developed in this study. Different policy options were analysed for a cost-effective solution of soil conservation programmes. Based on the final discussion on the involved transaction costs, the regulatory approach (a spatially-focussed ban on row crops) was shown to be the most cost-effective option with potentially lower transaction costs. The main criteria for a cost-effective policy design are high efficiency in both the agricultural measures (practices) and the spatial correlation between the programme area and the high erosion risk areas. Incentive programmes in combination with less effective agricultural practices showed a worse cost-benefit ratio for the sample area than the regulation approach, which is based on more effective agricultural practices.