Returns to scale in organic and local agriculture

At the third annual graduate student research conference organized by Friedman School students this past weekend, I moderated a session with three fascinating presentations by Robert Paarlberg, Susan Roberts, and Mark Winne.

Paarlberg praised the environmental potential of new "precision farming" technologies in conventional agriculture. He recommended targeted commercial pesticide applications and GMOs over organic agriculture. He argued that the alternative good food movement's emphasis on older food and farming traditions cause the movement to overlook the new industrial technologies that could really make a bigger difference for the environment.

One of his punchiest claims was that organic and local agriculture hinders the adoption of new pro-environmental technologies by preventing farmers from reaching adequate scale. Yet, when pressed, he agreed that most high-technology agriculture in the United States is conducted by farms with a scale of several hundred thousand dollars to a couple million dollars in sales. This is larger than your neighborhood CSA but not really very big from the perspective of most U.S. industries. Certainly, even within a particular small regional foodshed such as New England, there is room in the market for many competitive producers on this scale. Similarly, the federal government's organic labeling standard allows farmers of all scales to be organic.

Reflecting on Paarlberg's presentation, I could not see how local and organic agriculture really threatened most of the environmental farming technologies that Paarlberg finds most promising (GMOs, prohibited in the organic rule, are an exception that requires more discussion than time permits). Paarlberg's argument raises the question of whether organic and local food advocates can accept mid-sized family farms along with small farms as part of their sector. From advocates I have spoken with, I think the answer is "no problem."

For example, see Bob Comis at Ethicurean yesterday, discussing the need for moderately larger scale in progressive meat and poultry production, to make good meat more competitive with factory farm meat. Or, consider Kathleen Merrigan's eloquent response to tough questions from Senator Saxby Chambliss (R-GA) at her Senate confirmation hearing today, explaining how she can advocate for sustainable agriculture and what Saxby called "production agriculture" at the same time (I'll add a link to a transcript later when it becomes available).

Mid-scale local production preserves most, though not all, of the advantages of small-scale local production. And mid-scale production lowers costs and helps the local food movement overcome skepticism about its relevance to consumers of all income levels.

Saxby sees organic agriculture and production agriculture as enemies. Instead, why can't local and organic agriculture can be production agriculture?