The Roles of Agricultural Economists in Food System Research

Not since the early 1980s has interest in local, regional, national, and global food systems been as strong as it is today. This renewed interest confirms that good ideas come around every 30 years, but the analytical tools and concepts now used have improved, the scale of the analyses has expanded, and the research questions have changed. That agricultural economists have a role to play in food system research is not news to readers of this journal. Agricultural economists also hardly have a monopoly on the subject, as Reardon and Timmer (2012, p. 227) pointed out: "the system nature of the food system means it is conditioned by many factors and thus studied by many disciplines (anthropology, sociology, geography, and so on)." Nevertheless, agricultural economists can be uniquely positioned, if not uniquely qualified, to lead multidisciplinary food system studies.By "food system" I mean the networked set of input suppliers, farmers, processors, distributors, and consumers and the rules, incentives, and behaviors that make the system work. Viewing production, distribution, and consumption of food as integrated activities along the supply chain provides a useful framework for thinking about food system issues. In addition, because system components influence one another in the process of interacting, we can use emerging tools from network science to study food system issues. I highlight the roles of agricultural economists by first reviewing earlier research on food systems and describing a large-scale ongoing research project led by the Northeast Regional Center for Rural Development (NERCRD). Then I examine how economic development concepts are used to study the impacts of food systems and explore the use of emerging concepts from network science. In addition to providing essential language needed to frame food-system-related hypotheses, agricultural economists are trained to think in terms of system perspectives.1 In this context, I examine how insights gained by economists while working with individuals involved in other areas of food and system research can have more-general impacts by guiding policies and public and private investment decisions.A Brief HistoryThe roots of modern food system research can be traced, in part, to subsector studies sponsored by the North Central Regional Research Project (NC- 117) in the 1970s and 1980s that culminated in The Organization and Performance of the U.S. Food System, which was edited by Bruce W. Marion (1985). In these studies, which were conducted at the commodity level, flows of agricultural and other inputs were traced from on-farm transformation to first assemblers, wholesalers, and retailers and ultimately to consumers. The chart presented in Figure 1 is a useful tool for visually organizing the flow of inputs in a food marketing channel.The structure-conduct-performance (SCP) framework used by economists in the 1980s emphasized how an industry's structure or organization (number and size of firms, etc.) allowed different types of behavior (e.g., competitive, predatory, collusive) to emerge among participants in a food system. Superimposed on the physical flow of products that was fruitfully studied by engineers were rules and institutions that influence prices at different levels and nodes in a supply chain, in turn providing market signals and incentives. This arena naturally was where economists could add the greatest value and provide key analytical insights. Different incentives and initial structures lead to behaviors that in turn generate different kinds of performance in the overall industry. Furthermore, performance outcomes in any one year change the industry's structure in subsequent years, leading to new behaviors and performance. Many opportunities remain to introduce game theory into the study of food systems.A key contribution of this early work was recognition that competitive conditions in the food system were often less than perfect. …