Transition And Agriculture
The overall objectives of our proposed paper is to: (a) systematically document the post-reform trends in agricultural performance in Asia, Europe, and the Former Soviet Union; (b) identify the main reform strategies and institutional innovations that have contributed to the successes and failures of the sector; (c) analyze the mechanisms by which reform policies and initial conditions have affected the transition process in agriculture; and (d) draw lessons and policy implications from the experiment and identify the gaps in our understanding of the role and performance of agriculture in transition. As part of this effort, we attempt to address a number of intriguing and important questions on the performance of individual countries or regions during transition. Why has China been so successful in its reforms, while Russia has not? Why is it that some CEECs have rebounded and showing robust productivity growth, while others have not? Why has agriculture in so many FSU nations continued to perform so poorly? In addition, we will address questions about the process of reform. Why has land restitution predominated in Europe but not in Russia or China? Why did institutions of exchange collapse in the non-Asian economies in the early stages of reform but continued to function in Vietnam and China? What explains the apparent divergence in the performance effects after the first year of reform in China and Vietnam, on the one hand, and much of the rest of the transitional world on the other? In particular, how have land reform and rural input-supply/ procurement enterprise restructuring affected productivity? Which institutions of exchange and contracting have or have not emerged, and why? How has the structure of the economy at the outset of transition, and other initial conditions, affected the transition process? To meet our objectives and answer some of the questions, we will begin by laying out the record on performance examining the main bodies of data that demonstrate the changes in agricultural output, income, and productivity in the years after transition. In doing so, we will show how some of the countries have recorded similar performances, while others have developed quite differently. We will identify several "patterns of transition" based on these performance indicators and much of our subsequent discussion will analyze the success of transition according to these classifications. Next, as the first step in our search for answers as to what explains these different patterns, we examine differences in the points of departure of the transition countries as well as the nature of the policy reforms that have affected agriculture. The initial conditions that we hypothesize may explain part of the transition periods performance include the nature of agricultural technology at the beginning of the reforms (its scale; its labor intensiveness; etc.), the structure of the economy (the extent of industrialization), the extent of collectivization, and the magnitude of trade distortions. The key policy interventions that we should expect to affect agricultures performance during transition include land right reforms and farm restructuring; price and subsidization policies; the approach to the liberalization of agricultural commodity and input markets; general macro-economic and general institutional reforms; and the attention of sectoral leaders to the level of new and maintenance-oriented public goods investment (in agricultural research, irrigation, roads, and other infrastructure projects). After documenting the dramatic differences in initial conditions and in reform policies among the transitional countries, we seek to demonstrate which of the differences determine the path a countrys agriculture takes. In other words, we offer answers to the question why transition in agriculture in some countries has been successful and not in others. Here, we seek to generalize about the main causes for differences between the countries and the mechanisms that have affected performance. In particular, we argue that the debate on the optimality of Big-Bang versus gradualism oversimplifies the reform problem. The empirical evidence suggests that the road to a successful transition is more subtle and successful transitions in Asia and Europe have elements of both gradual and radical reforms. To explain the reform successes and failures we emphasize the role of the political environment in the early reform years and the potential for agricultural growth that exists at the start of reforms. We find that both have not only influenced the choice of the reform policies, but also the effect of the reform policies. We also conclude that the initial level of price distortions and the pace of market liberalization were especially influential in explaining differences in the early stages of transition but that the influence of the factors has diminished over time. Investment, land rights, and farm restructuring policies, in contrast, are assuming a more important role as the agricultural reforms have matured. In the last section we draw policy implications and lessons from the agricultural transition experiences. We argue that one should be careful about which indicator to use for measuring success and failure of transition. We conclude that all reform strategies in order to be successful need to include some certain policy ingredients (such as continued investment, etc.). However, a powerful lesson is that although all the pieces are ultimately needed, there is a lot of room for variation in the form of institutions that can be successful, and optimal policies and institutions may vary according to initial conditions. In other words, there is no single optimal transition path.
|Date of creation:||2000|
|Date of revision:|
|Contact details of provider:|| Phone: 530-752-1517|
Web page: http://www.agecon.ucdavis.edu/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- S. Fisher & R. Sahay & C. A. Vegh, 1997.
"Stabilization and Growth in Transition Economies: The Early Experience,"
N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 5.
- Stanley Fischer & Ratna Sahay & Carlos A. Vegh, 1996. "Stabilization and Growth in Transition Economies: The Early Experience," Journal of Economic Perspectives, American Economic Association, vol. 10(2), pages 45-66, Spring.
- Stanley Fischer & Carlos A. VÃ©gh Gramont & Ratna Sahay, 1996. "Stabilization and Growth in Transition Economies; The Early Experience," IMF Working Papers 96/31, International Monetary Fund.
- Fischer, Stanley & Sahay, Ratna & Vegh, Carlos, 1996. "Stabilization and growth in transition economies: The early experience," MPRA Paper 20631, University Library of Munich, Germany.
- de Melo, Martha & Denizer, Cevdet & Gelb, Alan & Tenev, Stoyan, 1997. "Circumstance and choice : the role of initial conditions and policies in transition economies," Policy Research Working Paper Series 1866, The World Bank.
- McMillan, John & Whalley, John & Zhu, Lijing, 1989. "The Impact of China's Economic Reforms on Agricultural Productivity Growth," Journal of Political Economy, University of Chicago Press, vol. 97(4), pages 781-807, August.
- Huang, Jikun & Rozelle, Scott, 1996. "Technological change: Rediscovering the engine of productivity growth in China's rural economy," Journal of Development Economics, Elsevier, vol. 49(2), pages 337-369, May.
- Csaki, S. & Nash, J., 1998. "The Agrarian Economies of Central and Eastern Europe and the Commonwealth of Independent States. Situation and Perspectives, 1997," World Bank - Discussion Papers 387, World Bank.
- Gow, Hamish R. & Streeter, Deborah H. & Swinnen, Johan F.M., 2000.
"How private contract enforcement mechanisms can succeed where public institutions fail: the case of Juhocukor a.s,"
Agricultural Economics of Agricultural Economists,
International Association of Agricultural Economists, vol. 23(3), September.
- Gow, Hamish R. & Streeter, Deborah H. & Swinnen, Johan F. M., 2000. "How private contract enforcement mechanisms can succeed where public institutions fail: the case of Juhocukor a.s," Agricultural Economics, Blackwell, vol. 23(3), pages 253-265, September.
- Macours, Karen & Swinnen, Johan F. M., 2000. "Causes of Output Decline in Economic Transition: The Case of Central and Eastern European Agriculture," Journal of Comparative Economics, Elsevier, vol. 28(1), pages 172-206, March.
- Nivelin Noev & Johan F.M. Swinnen, 2004. "Eastern Europe and the Former Soviet Union," Chapters, in: The World's Wine Markets, chapter 9 Edward Elgar Publishing.
- Karen Brooks, 1991. "Agriculture and the Transition to the Market," Journal of Economic Perspectives, American Economic Association, vol. 5(4), pages 149-161, Fall.
- Blanchard, O & Kremer, M, 1996.
96-30, Massachusetts Institute of Technology (MIT), Department of Economics.
- Olivier Blanchard & Michael Kremer, 1997. "Disorganization," William Davidson Institute Working Papers Series 38, William Davidson Institute at the University of Michigan.
- Blanchard, Olivier & Kremer, Michael R., 1997. "Disorganization," Scholarly Articles 3659691, Harvard University Department of Economics.
- Seeth, Harm Tho & Chachnov, Sergei & Surinov, Alexander & Von Braun, Joachim, 1998. "Russian poverty: Muddling through economic transition with garden plots," World Development, Elsevier, vol. 26(9), pages 1611-1624, September.
- Andrew Watson, 1994. "China's Agricultural Reforms: Experiences and Achievements of the Agricultural Sector in the Market Reform Process," Chinese Economies Research Centre (CERC) Working Papers 1994-04, University of Adelaide, Chinese Economies Research Centre.
- Macours, Karen & Swinnen, Johan F M, 2002. "Patterns of Agrarian Transition," Economic Development and Cultural Change, University of Chicago Press, vol. 50(2), pages 365-94, January.
- Dwight H. Perkins, 1994. "Completing China's Move to the Market," Journal of Economic Perspectives, American Economic Association, vol. 8(2), pages 23-46, Spring.
- Mathijs, Erik & Swinnen, Johan F M, 1998. "The Economics of Agricultural Decollectivization in East Central Europe and the Former Soviet Union," Economic Development and Cultural Change, University of Chicago Press, vol. 47(1), pages 1-26, October.
- Fan, Shenggen, 1997. "Production and productivity growth in Chinese agriculture: new measurement and evidence," Food Policy, Elsevier, vol. 22(3), pages 213-228, June.
- Selowsky, Marcelo & Martin, Ricardo, 1997. "Policy Performance and Output Growth in the Transition Economies," American Economic Review, American Economic Association, vol. 87(2), pages 349-53, May.
- Sicular, Terry, 1988. "Plan and Market in China's Agricultural Commerce," Journal of Political Economy, University of Chicago Press, vol. 96(2), pages 283-307, April.
- Pingali, Prabhu L & Xuan, Vo-Tong, 1992. "Vietnam: Decollectivization and Rice Productivity Growth," Economic Development and Cultural Change, University of Chicago Press, vol. 40(4), pages 697-718, July.
- Friebel, Guido & Guriev, Sergei, 2000.
"Why Russian Workers Do Not Move: Attachment Of Workers Through In-Kind Payments,"
CEPR Discussion Papers
2368, C.E.P.R. Discussion Papers.
- Guido Friebel & Sergei Guriev, 1999. "Why Russian Workers Do Not Move: Attachment of Workers Through In-Kind Payments," William Davidson Institute Working Papers Series 283, William Davidson Institute at the University of Michigan.
- Guido Friebel, 2000. "Why Russian Workers do not Move: Attachment of Workers through In-Kind Payments," Econometric Society World Congress 2000 Contributed Papers 1376, Econometric Society.
- Sarris, Alexander H & Doucha, Tomas & Mathijs, Erik, 1999. "Agricultural Restructuring in Central and Eastern Europe: Implications for Competitiveness and Rural Development," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 26(3), pages 305-29, August.
- Brooks, Karen M. & Guasch, Jose Luis & Braverman, Avishay & Csaki, Csaba, 1991. "Agriculture and the transition to the market," Policy Research Working Paper Series 666, The World Bank.
- Fan, Shenggan & Pardey, Philip G., 1997. "Research, productivity, and output growth in Chinese agriculture," Journal of Development Economics, Elsevier, vol. 53(1), pages 115-137, June.
- Erik Mathijs & Johan F. M. Swinnen, 2001. "Production Organization And Efficiency During Transition: An Empirical Analysis Of East German Agriculture," The Review of Economics and Statistics, MIT Press, vol. 83(1), pages 100-107, February.
- Sedik, David & Trueblood, Michael & Arnade, Carlos, 1999. "Corporate Farm Performance in Russia, 1991-1995: An Efficiency Analysis," Journal of Comparative Economics, Elsevier, vol. 27(3), pages 514-533, September.
- Putterman, Louis, 1992. "Dualism and Reform in China," Economic Development and Cultural Change, University of Chicago Press, vol. 40(3), pages 467-93, April.
- Woo Wing Thye, 1994.
"The Art of Reforming Centrally Planned Economies: Comparing China, Poland, and Russia,"
Journal of Comparative Economics,
Elsevier, vol. 18(3), pages 276-308, June.
- Woo, W.T., 1993. "The Art of Reforming Centrally-Planned Economies: Comparing China, Poland and Russia," Papers 93-09, California Davis - Institute of Governmental Affairs.
- McMillan, John & Naughton, Barry, 1992. "How to Reform a Planned Economy: Lessons from China," Oxford Review of Economic Policy, Oxford University Press, vol. 8(1), pages 130-43, Spring.
- Lerman, Z. & Brooks, K. & Csaki, C., 1994. "Land Reform and Fram Restructuring in Ukraine," World Bank - Discussion Papers 270, World Bank.
- Colin A. Carter, 1997. "The Urban-Rural Income Gap in China: Implications for Global Food Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(5), pages 1410-1418.
- Brenton, Paul & Di Mauro, Francesca, 1999. "The Potential Magnitude and Impact of FDI flows to CEECs," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 14, pages 59-74.
- Brooks, K. & Krylatykh, E. & Lerman, Zvi & Uzun, V., 1996. "Agricultural Reform in Russia: A View from the Farm Level," World Bank - Discussion Papers 327, World Bank.
- Repkine, Alexandre & Walsh, Patrick Paul, 1999. "Evidence of European Trade and Investment U-Shaping Industrial Output in Bulgaria, Hungary, Poland, and Romania," Journal of Comparative Economics, Elsevier, vol. 27(4), pages 730-752, December.
- Zvi Lerman, 1999. "Land Reform and Farm Restructuring: What Has Been Accomplished to Date?," American Economic Review, American Economic Association, vol. 89(2), pages 271-275, May.
- Hay, Jonathan R & Shleifer, Andrei, 1998. "Private Enforcement of Public Laws: A Theory of Legal Reform," American Economic Review, American Economic Association, vol. 88(2), pages 398-403, May.
- Trzeciak-Duval, Alexandra, 1999. "A Decade of Transition in Central and Eastern European Agriculture," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 26(3), pages 283-304, August.
- Albert Park & Hehui Jin & Scott Rozelle & Jikun Huang, 2002. "Market Emergence and Transition: Arbitrage, Transaction Costs, and Autarky in China's Grain Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(1), pages 67-82.
- Csaki, Csaba, 1998. "Agricultural Research in Transforming Central and Eastern Europe," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 25(3), pages 289-306.
- Anders Åslund & Peter Boone & Simon Johnson, 1996. "How to Stabilize: Lessons from Post -communist Countries," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 27(1), pages 217-314.
- Johan F. M. Swinnen, 1999. "The political economy of land reform choices in Central and Eastern Europe," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 7(3), pages 637-664, November.
When requesting a correction, please mention this item's handle: RePEc:ags:ucdavw:11948. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If references are entirely missing, you can add them using this form.