President's Column

July 2016

In closing out my Presidential year, I am optimistic about the vibrant direction and impacts of our research as agricultural and applied economists.  I am simultaneously appreciative of the foundations that were laid by those who came before me and the innovations of those going forward.  Agricultural and applied economics started as the problem-driven study of farm economics and farm management.  In studying these areas, agricultural economics researchers were the first applied econometricians.  Working’s 1926 paper on statistical demand analysis is considered a seminal article in the field of demand and price analysis.  The study of differentiated products, and specifically hedonic methods, is traced to Waugh’s 1928 analysis of quality in vegetable markets.  Empirical innovations remain a major thrust of our research as a profession.  As Jayson Lusk will discuss in his upcoming Presidential Address, agricultural and applied economists are well-positioned to contribute research in top economics journals as published contributions become increasingly empirical, partly in response to growing data quality and availability.   With increased computing power and access to big data, it is possible to conduct more granular analyses, and obtain results that attain a closer fit to the real world.  Thus, the impact of such analyses can potentially be greater.

David Zilberman notes in his blog that farmers’ decision making under uncertainty has long been a major topic of agricultural economics.  Trying to understand some of the farmer choice outcomes leads us to the behavioral economics paradigm.  Behavioral economics extends the traditional approach to economic analysis by incorporating findings from other disciplines in the behavioral sciences. In particular, while economists have historically restricted their attention to the roles of price, income, and information in driving consumer choice, behavioral economists allow for the possibility that cognitive, social, and emotional factors may be important in certain situations, especially in designing policy.  On this point, David Nussbaum argues, “the goal of behaviorally informed policy is to make it easier for people to make good decisions, while preserving their ability to freely choose.”  It follows that we, as agricultural and applied economists, can then rigorously evaluate which policies work in order to increase their effectiveness.

I look forward to seeing you in Boston.  Please join in the discussions that follow the outstanding presentations that will be given.  Our group is large enough so that there is enriching diversity of topics, thinking, and approaches.  As we interact across sub-fields and projects, I hope that many new insights will be gained. 

References:

Nussbaum, D. (2015). “How the science of human behavior is beginning to reshape the U.S. government,” available at:
        https://theconversation.com/how-the-science-of-human-behavior-is-beginning-to-reshape-the-us-government-48145

Waugh, F. 1928. “Quality Factors and Vegetable Prices.” Journal of Farm Economics 10: 185–96.

Working, E. J. 1926. What Do Statistical Demand Curves Show? Quarterly Journal of Economics 41: 212–235.