A plea for real world economics

A lauded U.S. agricultural economist is issuing a plea to his profession: please make ag economics relevant to farmers and the world of farming because now it is mostly irrelevant.

“I think the system is skewed,” Danny Klinefelter, a prominent Texas A and M University professor, said in an interview a few days after his official retirement.

“It’s not that I think that the research that’s being done is not good stuff and doesn’t have a place; it’s that it’s being done to the exclusion of applied (economics.)”

Klinefelter is famous among farm management and finance buffs for his insights into the real-world margins, advantages, differences and impacts of decisions made by farmers.

His views about trying to achieve a number of “five percent” gains in management results that lead to more than 100 percent gains in profitability have spread wide among farm managers.

His plea comes after decades of seeing, in his view, a bias against agricultural economic research that can be applied to actual farms.

Ag economic faculties at universities favour abstract and technical research that ends up producing articles that run in specialized academic journals, rather than producing work that can be used to make a concrete difference on a farm.

Klinefelter said the bias hits while graduate students are working on their masters degrees.

They find that their best chance at getting accepted to Ph.D. programs and eventually professorships comes through publishing in refereed journals, and little value is given to exploring applied economics or interacting with farmers.

That means few agricultural economists working at U.S. universities focus on or even ever include work that looks at the impact of economic ideas at a farm level.

“It’s just not given the weight and the significance,” said Klinefelter.

“They are the business department of the college of agriculture, and that part is being (ignored).”

Some have argued that universities and government agriculture departments offer extension economics programs that reach out to farmers, but Klinefelter said they generally don’t fill the gap left by the failure of academics to engage with applied economics.

“It’s not helping the decision-makers who count,” said Klinefelter.

Extension economics tends to try to reach the greatest number of farmers, so the concepts that are communicated are often too general and simple to help the top farm managers, Klinefelter said.

The difference between the very best farm managers and very good farm managers is a question of small gains made by the first group a couple of years before others figure them out, which means it is essential to discover those gains early and communicate them quickly.

Klinefelter and the few fellow agricultural economists who share his interest have established programs to reach out to leading farm managers.

For example, Klinefelter is director of the Executive Program for Agricultural Producers.

However, for agricultural economics to become relevant to those who most desperately need its attention and insights, ag economics programs and faculties need to stop devaluing research that focuses on helping farmers directly.

“If equal weight was put on those two things, it would help a great deal,” said Klinefelter.

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