Introduction

This paper looks at the costs of achieving improvements in farmers' lives through the adoption of organic agriculture (OA). Specifically we estimate the public and private costs that are incurred and evaluate whether or not they represent good value when compared to the gains in terms of individual incomes and other benefits as defined in the Millennium Development Goals (MDGs). Other studies have found that while there are strong links between OA and the MDGs (Setboonsarng and Markandya 2009), these can be complex and not always quantifiable. Hence the comparison of the costs of adopting OA with the benefits has to be in part a qualitative exercise, but it is one that still needs to be carried out. This paper is a contribution to that comparison.

This paper is part of a series of papers on organic agriculture and the MDGs published by the Asian Development Bank Institute. Section II describes the MDGs and reports what public expenditures are foreseen as necessary to achieve these goals world-wide. These expenditures are also reported in terms of the cost per person: who benefits with regards to poverty reduction, education levels, child mortality reduction, etc. As far as we are aware, this is the first time such estimates have been made for a range of MDGs. They provide the background against which benefits from the OA programs can be assessed. Section III discusses the items of cost that arise in implementing OA. Different types of costs have different implications for policy purposes; for example, costs undertaken by the farmers themselves are netted out of the benefits and only the net benefit figure is looked at when measuring gains. On the other hand, public expenditures require access to external funds and have to be evaluated in terms of ‘value for money'. Section IV reports the estimate costs of the programs in case studies undertaken in the People's Republic of China (PRC), Sri Lanka and Thailand. It explains the methodology used in deriving these estimates, and comments on the differences in costs between countries. Section V compares these costs in terms of the benefits gained and, indirectly, in terms of the MDGs. Section VI concludes the chapter with some recommendations for future work.

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Comment(s)

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1. Prof. J. George
   (posted 19 February 2010 / 07:17:28 PM)
   
   The authors needs to be complimented for this study that is first of its kind particularly in so much as relating it to MDG. It is unfortunate that the UNESCAP-ADB-UNDP trio did not take cognisance of it while reviewing MDGs recession during the recent global financial crisis. The study is timely as it indicates the way out for rationalizing inclusive growth strategy in a region that is characterised by not only a larger proportion but also growing numbers of hungry and poor people in the world.
   Secondly, the paper completely compliments the UNEP-UNCTAD's path breaking longitudinal study in African and the Central American continents as well as trade and environment review of 2006 and and 2009.
   Thirdly, The study is also contemporary as it is a one shot answer to the the vexing question of climate change related mitigation and adaptation strategies.
   
   Fourthly, the study does reinforce that food security as enshrined in MDGs 1C is fully attainable at a cost effective manner. ADB need to take conscious decisions to explicitly reinforce it as its thrust area given that the strategy 2020 sounds hallo in the absence of a credible alternative. The paper provides a good indication to that pathway. The strategic economic management initiative as defined necessarily must be based on inclusiveness and organic agriculture restores that power in the hands of the producers for a number of opportunities for autonomous income enhancement amongst the poorer segments of the population, among other associated reform measures.