Comparative Economics of Conventional, Organic, and Alternative Agricultural Production Systems

Abstract

Agricultural production systems are a composite of philosophy, adoptability, and careful analysis of risks and rewards. The two dominant typologies include conventional and organics, while biotechnology (GM) and Integrated Pest Management (IPM) represent situational modifiers. We conducted a systematic review to weigh the economic merits—as well as intangibles through an economic lens—of each standalone system and system plus modifier, where applicable. Overall, 17,485 articles were found between ScienceDirect and Google Scholar, with 213 initially screened based on putative relevance. Of those, 82 were selected for an in-depth analysis, with 63 ultimately used. Economically, organic generally outperformed conventional systems. This is largely due to their lower production costs and higher market price. However, organic farms face lower yields, especially in the fruit, vegetable, and animal husbandry sectors. With that said, organic farming can provide significant local environmental benefits. Integrated pest management (IPM) is a potentiator of either core system. As a risk reduction and decision-making framework, it is labor intensive. However, this can be offset by input reductions without yield penalty compared to a conventional baseline. Biotechnology is a rapidly emerging production system, notably in developing countries. The use of GM crops results in lower production cost and higher yields. As a conventional modifier, its major advantage is scale-neutrality. Thus, smaller and lower income farmers may achieve higher gross margin. The main source of environmental benefits is reduced pesticide use, which implies a decreased need for fuel and labor. Barring external influences such as subsidies and participation in prescriptive labeling programs, farmers should focus on an a la carte approach (as opposed to discrete system adoption) to optimize their respective enterprises.

Farmer Decision-Making on the Concept of Coexistence: A Comparative Analysis between Organic and Biotech Farmers in the Philippines

“…Furthermore, the work of Ram and Jung (1991) states that such individuals who pursue product trial and repetitive use significantly reduce innovation resistance and allow for a positive post-adoption evaluation (satisfaction and attitude) within their group [48]. Organic farmers are aware that their yield is comparatively low compared to biotech farmers [49,50], and based on their narratives, they are interested in adopting biotech crops due to stable yields and resistance to pest and diseases. This was highlighted in testimonials by interviewed organic farmers such as by Respondent 38, who stated, "I want to test it.…”

Financial Profitability of Diversified Farming Systems: A Global Meta-Analysis

“…We found that diversified systems promote more employment opportunities with no loss of profits when compared to simplified systems. The higher gross income and comparable profits in diversified systems in our study may be explained by higher productivity associated with increases in farm work and crop diversification (Branca et al, 2021;Durham and Mizik, 2021;Tey and Brindal, 2014). Improving data collection on labour inputs would help strengthen the evidence base.…”

Az ökológiai termelés és termékek piacának változásai a COVID-19 okozta megszorítások alatt

“…E gazdaságok azonban alacsonyabb hozamokkal szembesülnek, különösen a gyümölcs-, zöldség-és állattenyésztési ágazatokban. Ezzel együtt a biogazdálkodás jelentős helyi környezeti előnyökkel járhat (Durham & Mizik, 2021). Az 1. táblázat adatai mutatják, hogy az ökológiai termelés is árérzékeny és a filozófiát követő termelés mellett az eredményesség is kiemelten fontos, sőt valamikor fontosabb, mint az elvek.…”