Food Policy for Developing Countries: The Role of Government in Global, National, and Local Food Systems

Food Policy for

Developing Countries

The Role of Government in Global,

National, and Local Food Systems

Per Pinstrup-Andersen and Derrill D. Watson II

Foreword by Søren E. Frandsen, Arie Kuyvenhoven,

and Joachim von Braun

Cornell University Press

Ithaca and London

Contents

List of Figures

List of Tables

Foreword

Preface

Acknowledgments

Chapter 1. Toward a Dynamic Global Food System

Introduction

Toward a Global Food Systems Approach

The Global Food System

Complex Systems Analysis

Organizations That Impact the Food System

Emerging Trends and Driving Forces

Conclusion

Notes

Chapter 2. Food Policy

Introduction

Definition of Food Policy

Political Economics

Stakeholder Analysis

Food Policy in the Global Food System

How Do Governments Intervene?

Macroeconomic Policies and the Food System

A Political Economy Analysis of Food Policy

Conclusion

Notes

Chapter 3. Human Health and Nutrition Policies

Introduction

Dietary Energy and Nutrients

Other Food System Interactions with Human Health

Current World Health and Nutrition Situation

Nutrition Transition

Economic Payoffs from Health and Nutrition Improvements

Policy Options to Improve Health and Nutrition

Comparing Alternatives: An Example of Efforts to Reduce Dietary Iron Deficiency

Conclusion

Human Health and Nutrition Policies Case Studies

Notes

Chapter 4. Food Security, Consumption, and Demand Policies

Introduction

The Food Consumption Situation

Food Security: Millennium Development Goals and the World Food Summit

Household Choices: Coping and Adaptation

Population Growth and Demographic Transitions

Consumer and Household Demand Analysis

Food Consumption Analysis

Food Consumption Policies

Conclusion

Food Security, Consumption, and Demand Policies Case Studies

Notes

Chapter 5. Poverty Alleviation Policies

Introduction

World Poverty Situation

Who Stays Poor?

Conceptual Issues of Multidimensional Poverty

Poverty and the Food System

Poverty Reduction Policies

Conclusion: Reducing Poverty

Poverty Alleviation Policies Case Studies

Notes

Chapter 6. Domestic Market Policies

Introduction

A Marketing System

Introductory Theory of the Firm

Food Markets

Structural Change in Food Markets

Food Marketing Policies

Conclusion

Domestic Market Policies Case Studies

Notes

Chapter 7. Food Production and Supply Policies

Introduction

The Economic Importance of Agricultural Production

Food Production Situation

New Farming Techniques

Increasing Yields through Research and the Green Revolution

Smallholder Agriculture

Policies for Production and Supply

Contextual Policies

Conclusion

Food Production and Supply Policies Case Studies

Notes

Chapter 8. Climate Change, Energy, and Natural Resource Management Policies

Introduction

The Food System and Natural Resource Management

Environmental Externalities Related to the Food System

Climate Change and the Food System

Poverty, Hunger, and Sustainability Goals: Trade-Offs and Policy Implications

The Environmental Kuznets Curve and Full-Costing

Policy Options to Maintain Sustainable Use of Natural Resources

Conclusion

NRM Policies Case Studies

Notes

Chapter 9. Governance and Institutions

Introduction

Institutions in Economics

Governance Situation

Governance and the Food System

Recent Trends in Governance

International Governance

Conclusion

Governance and Institutions Case Studies

Notes

Chapter 10. Globalization and the Food System

Introduction

The International Food Trade Situation

The International Capital Market

International Technology Transfer

The Role of Biotechnology

The International Labor Market

Policies to Guide Globalization

Conclusion

Globalization and the Food System Case Studies

Notes

Chapter 11. Ethical Aspects of Food Systems

Introduction

Ethical Systems

Social Welfare Functions and Pareto Efficiency

Equity and Equality

Households and Other Actors

Poverty, Hunger, and Nutrition

Food Safety

Food Sovereignty

Markets and Morality

Animal Welfare and Environmental Ethics

Trade and Aid

Implicit Normativity in Research

Biotechnology

Conclusion

Ethical Aspects of Food Systems Case Studies

Notes

References

Figures

Figure 1.1. A Conceptual Framework of a Food System

Figure 2.1. Core Problems Reducing the Effectiveness of the International Nutrition System

Figure 3.1. Interactions between Food Systems and Human Health and Nutrition

Figure 3.2. Deaths Associated with Malnutrition

Figure 3.3. Malnutrition and the Intergenerational Transmission of Chronic Poverty

Figure 3.4. The Window of Opportunity for Addressing Undernutrition

Figure 3.5. Maternal and Child Undernutrition Framework

Figure 3.6. A Simplified Conceptual Framework Linking Food Availability, Food Security, and Nutrition

Figure 3.7. Potential Points of Contamination with Food Safety Hazards along the Farm-to-Table Food Supply Chain

Figure 3.8. Consumption of Fruits and Vegetables (kg/person/year)

Figure 4.1. Progress toward Meeting the World Food Summit Goal

Figure 4.2. Economic Growth and Hunger

Figure 5.1. The Chronic Poor, Transient Poor, and Nonpoor: A Categorization

Figure 5.2. Millions of Ultra Poor (<$0.50/day) by Region in 1990 (a) and 2004 (b)

Figure 5.3. $1/Day Poverty and Growth in Sub-Saharan Africa, 1970–2006

Figure 7.1. Cereal Yields and Poverty Rates in South Asia and SSA

Figure 7.2. Cereal Yield (kg/ha) by Region: 1961–2007

Figure 7.3. FAO API per Capita by African Subregion: 1990–2006

Figure 7.4. Meat Production (Tons) by Region: 1961–2007 (1961 = 100)

Figure 7.5. Real Food Price Index: 1900–2008 (1900 = 100)

Figure 7.6. Cereals Price Index: 1990–2009 (2002–2004 = 100)

Figure 7.7. Farm Size (Ha) in Select Countries

Figure 7.8. Trade-Off between Safety Nets and Public Goods Investments

Figure 8.1. Liters of Water per Kilogram of Product

Figure 8.2. Hypothetical Patterns of Negative Impact of Climate Change on Agriculture

Figure 8.3. The Environmental Kuznets Curve

Figure 8.4. Hypothetical Relationships between Income and Deforestation/Soil Mining

Figure 10.1. Global Area of Biotech Crops (Million Hectares)

Tables

Table 2.1. Food Policy: Old and New

Table 2.2. Backward and Forward Linkages

Table 3.1. Under-Five Mortality Rates, 1990 and 2005 (per 1,000)

Table 3.2. Estimated Prevalence of Malnutrition among Preschool Children (Percent)

Table 3.3. Contribution of Food Groups to Dietary Energy in Developing Countries (Percent)

Table 3.4. Top Contributors to Lost DALYs, Global

Table 4.1. Global and Regional per Capita Food Consumption (Kcals/Person/Day)

Table 5.1. Major Demands by Subgroups (Percent within Each Subgroup)

Table 5.2. Percentage of Population Living below $1.25 and $2 per Day

Table 5.3. Millions of People Living below $1.25 and $2 per Day

Table 5.4. Mean Income of the Poor in Dollars per Day

Table 6.1. Example of a Trader’s Marketing Costs per Kilogram of Tomatoes

Table 7.1. Agriculture’s Share of GDP and Employment

Table 7.2. Estimates of the Agricultural Multiplier

Table 7.3. Comparative Effectiveness of Public Goods Investments

Table 8.1. Causes of Soil Degradation, 1945–1995 (Percent)

Table 8.2. Climate Impact of Foodstuffs

Table 9.1. Range of Annual Domestic Welfare Gains and Losses from Support Programs under the 1985 Food Security Act, 1985–1988 (Billions of Dollars)

Table 9.2. Means of Selected Socioeconomic Indicators for Countries in Conflict and Countries Not in Conflict, 1980–2005

Table 9.3. Countries Demonstrating Improved Governance by Region, 1991–2001

Table 11.1. Legally Codified Rights and Acknowledged Duty Bearer Cases

Foreword

Nearly 1 billion people around the world currently suffer from hunger and inadequate nutrition. Another billion are overweight or obese. Technological advances in agriculture have lifted hundreds of millions of people out of hunger, poverty, and hopelessness, but such progress has not been uniform. In addition to these perennial challenges, new issues face the food system as well, including climate change, dietary transition, natural resource degradation, water scarcity, ethical and environmental ramifications of genetically modified organisms, and globalization. These challenges call for an improved food policy analysis that can both address their multidimensional effects and improve public awareness of how food policies are made, as well as how such policies affect lives. The goal of this book is to provide an important tool for students, policymakers, and people who work throughout the food system, as well as consumers and concerned citizens, to understand food policies.

Realizing the necessity for improved training in food policy analysis, in 2005 World Food Prize laureate Per Pinstrup-Andersen envisioned a social entrepreneurship approach to teaching food policy analysis. Entrepreneurship education helps students become leaders, innovators, and creative problem solvers. In the face of apocalyptic stories, the sensationalization of problems in the food system, and the unhelpful advocacy of particular food lifestyles without due consideration of the consequences of such proposals for other actors in the food system, this new approach to understanding and teaching food policy analysis provides a forward vision. The social entrepreneurship approach is much more than plain common sense or an abstract theory; as shown throughout this book, it is capable of addressing the challenges to the food system, policymakers’ needs, and public concerns.

To effectively communicate this new approach to food policy, we joined Per as collaborators to address the need for more effective training and policymaking. Together we organized an Advisory Task Force, consisting of seven individuals—including university faculty members, high-level policy advisers, and former policymakers—from the developing regions of the world:

• Kwadwo Asenso-Okyere, Professor Emeritus, Office of the Vice-Chancellor, University of Ghana, and Director, IFPRI East and Southern Africa Office, Addis Ababa, Ethiopia

• Bernard Bashaasha, Head, Department of Agricultural Economics, Makerere University, Uganda

• Sattar Mandal, Professor, Department of Agricultural Economics, Bangladesh Agricultural University, Bangladesh

• Eugenia Serova, Professor, Institute for Transition Economics, Moscow, Russia

• Fernando Vio, Director, Institute of Nutrition, University of Chile, Chile

• Zhong Tang, Professor, School of Agricultural Economics and Rural Development, Renmin University, Beijing, China

• Ricardo Uauy, Professor, School of Public Health and Nutrition, University of Chile, Chile, and Professor, London School of Hygiene and Tropical Medicine, University of London, United Kingdom

The efforts of this team culminated in the current textbook that covers the key aspects of global food system policies and the related series of case studies that describe real policymaking environments in detail.

Food Policy for Developing Countries: The Role of Government in Global, National, and Local Food Systems covers the many policies that affect food systems, from agricultural and climate change policies to nutrition, poverty, and trade policies, and political governance. The approach and this work then expand on, update, and complement the seminal 1983 text in this area, Food Policy Analysis, by C. Peter Timmer, Walter D. Falcon, and Scott R. Pearson (Baltimore, MD: World Bank/Johns Hopkins University Press). Not only the effects of policies are addressed, but attention is paid to the political and ethical reasons governments favor one policy over another. The principles and messages here apply to and provide a common framework to study a wide variety of circumstances.

This wide applicability is amply demonstrated by the case studies, which cover more than thirty-five countries and regions and were contributed to by more than one hundred researchers with real life and professional experience with the issues they address. Per and Fuzhi Cheng, then a postdoctoral research associate at Cornell University, edited the cases, with the benefit of advice from many outside experts, in a three-volume work published by Cornell University Press. All the cases in these volumes and new additional cases are archived and available via open access at http://cip.cornell.edu/gfs. The case studies have already been incorporated with great success in classrooms across south and east Asia, sub-Saharan Africa, the United States, and Europe.

Food Policy for Developing Countries was designed as a core text to be used in conjunction with the case studies primarily with advanced undergraduate and first-year graduate students from a wide variety of disciplines in mind. Earlier editions of the text have been used by students in nutrition, economics and agricultural economics, sociology, political science, plant and soil science, and business. It has proven effective in clearly communicating the principles of food policy analysis across a wide disciplinary spectrum. This means that no prior background is required to appreciate the points being made and that the work is readily accessible by a broad audience. The textbook is the worthy culmination of more than five years of labor by Per, the collaborators, the Advisory Task Force, the case study authors, and the external reviewers. Worthy of special mention is Derrill D. Watson II, Assistant Professor at American University of Nigeria, whose collaborations with Per resulted in work presented to the United Nations, Kuwait, Egypt, and Australia. Derrill joined the team in 2008 to help synthesize the vast bodies of research on the global food system’s many facets into the coherent, comprehensive, and accessible book you hold in your hands.

Per’s vision has proven to be prophetic. As the 2006–2008 food price crisis shows, as well as more recent developments and challenges in the global food markets, the lessons in this book on global food policy are needed now more than ever to help the world overcome the perennial problems of hunger, malnutrition, and poverty in a sustainable way that addresses our ever-changing food system and the new challenges it faces. We are excited to bring this book to your attention and believe it will serve you as a highly relevant text. It has been prepared and reviewed with care, conviction, and concern for our food systems, and the high caliber of its scholarship and writing make it the essential and definitive text on food policy.

SØREN E. FRANDSEN, Pro-Rector, Aarhus University, Denmark

ARIE KUYVENHOVEN, Professor Emeritus and former Director,

Wageningen School of Social Sciences, the Netherlands

JOACHIM VON BRAUN, Director, Center for Development

Research (ZEF), Bonn University, Germany

Preface

This book is about global, national, and local food systems and how they can be influenced by policies and programs. The first two chapters describe what food systems are and how food policy is made. Before going into detail about specific policies addressed at the various parts of the system, the book seeks to take account of the complexity of food systems and their interactions with other sectors of societies by casting the analyses in a cohesive multidisciplinary systems framework. Emphasis is on identifying policy options to guide food systems relevant for developing countries to better achieve societal goals such as reducing poverty, food insecurity, and malnutrition; improving health and economic growth; sustainably managing natural resources; and reducing adverse interactions with climate change.

The book is designed on the premise that a better understanding of food systems and how they may be improved through policy and program interventions will result in more effective and enlightened interventions. We believe that policymakers will more likely achieve their various stated goals and better meet the challenges and pressures they face when policy is founded on evidence drawn from a holistic understanding of food systems.

The book is tailored to strengthen university-level training to understand, analyze, advise, and make decisions about government policies. We believe the book can serve as an appropriate textbook in courses on food systems broadly defined to include human health and nutrition; food security, economics, and policy; food demand, production, and supply; domestic and international trade policies; and environmental policies and ethics. Using a political economy framework, the importance of stakeholder interests and pressures are highlighted in a complex systems analysis of food policy processes.

Although we are both economists, this book takes a multidisciplinary systematic approach to policy analysis. It is written with students and other readers from a range of disciplinary backgrounds in mind, though it can also be useful for lay audiences attempting to understand the complexity of the global food system and the challenges we face in it. Economic and other single-disciplinary concepts are explained when first introduced so that prior course work in economics or nutrition is not essential in order to understand the content of the book.

This book may be used as the sole text for a course on food policy or it may be used in combination with a set of case studies covering policy aspects of specific key components of the food system each within a specific context.¹ Together with the case studies, the book provides the teaching material for an approach we call a social entrepreneurship approach to the teaching of food policy. This approach, which we believe is innovative and participatory, is described in the references cited in note 1 below where the cases may also be found. The approach is being used by several universities in south and east Asia, sub-Saharan Africa, Europe, and the United States, including Cornell University, where it has been used since 2006 to train undergraduate and graduate students from varied disciplines such as nutrition, international agriculture, agronomy, business, agricultural economics, sociology, and economics. Both student and instructor evaluations of the approach have been very positive.

We hope that this book will make a significant contribution to the understanding of what governments can do to guide the future food situation and the consequences of various policy actions. If our work results in a more enlightened set of policies that improve the lives of disadvantaged people and a more sustainable management of the earth’s natural resources, our goal has been achieved.

PER PINSTRUP-ANDERSEN AND DERRILL D. WATSON II

Notes

1. Available in open access on http://cip.cornell.edu/gfs and in a three-volume book: Per Pinstrup-Andersen and Fuzhi Cheng, eds., Case Studies in Food Policy for Developing Countries (Ithaca, NY: Cornell University Press, 2009).

Acknowledgments

The preparation of the manuscript for this book benefitted from the support of many individuals. We are grateful for the advice and feedback to earlier drafts of the manuscript received from our collaborators (Søren E. Frandsen, Arie Kuyvenhoven, and Joachim von Braun) and the members of the Advisory Task Force (Kwadwo Asenso-Okyere, Bernard Bashaasha, Sattar Mandal, Eugenia Serova, Fernando Vio, Zhong Tang, Ricardo Uauy, and Funing Zhong).

We are grateful for the feedback received from faculty and students who used earlier drafts of the manuscript and/or the related case studies in courses held at several universities including: Alem Araya, Mekelle University, Ethiopia; Anoma Ariyawardana, University of Peradeniya, Sri Lanka; Subhasish Biswas, West Bengal University of Animal and Fishery Science, India; Bethany F. Econopouly, Patrick F. Byrne, and Marc A. Johnson, Colorado State University; Zhongxing Guo, College of Public Administration, Nanjing Agriculture University, China; Sheryl Hendricks, African Centre for Food Security, University of KwaZulu-Natal, South Africa; Zakir Hussain, University of Sargodha, Pakistan; Charles Jumbe, Bunda College, University of Malawi, Malawi; Shiv Kumar, National Centre for Agricultural Economics and Policy Research, India; Yu Leng, Antai College of Economics and Management, Shanghai Jiaotong University, China; Emily Levitt and Suresh Babu, American University and IFPRI; Reneth Mano, University of Zimbabwe, Zimbabwe; Gideon Obare, University of Hohenheim, Germany; Robert Paarlberg, Harvard University; Anthony Panin, CMMAE Program, University of Pretoria, South Africa; Beatrice Rogers, Tufts University; Basanta K. Sahu, Indian Institute of Foreign Trade (Deemed University), India; Le Ha Thanh, Hanoi National Economics University, Vietnam; and Henrik Zobbe, University of Copenhagen, Denmark.

The preparation of the manuscript benefitted greatly from the technical support by Mary-Catherine French, Colleen Boland, and Lynne Morgan. Comments and suggestions by an anonymous reviewer strengthened the manuscript.

Chapter 1

Toward a Dynamic Global Food System

Introduction

In the more than three decades since the 1974 World Food Conference announced its goal of eradicating hunger and malnutrition, worries about global food problems have continued unabated. In some cases, these worries have been misplaced and resulted in misguided policies. In other cases, complacency has resulted in missed opportunities to resolve challenges. Reliable unbiased evidence is of critical importance to assist policymakers in arriving at the most appropriate decisions. The primary concern of the international community has been food security, a condition when all people, at all times, have physical and economic access to sufficient, safe and nutritious food to meet their dietary needs and food preferences for an active and healthy life (FAO 1996a). Decision makers, policy analysts, and concerned citizens have widely debated questions of how much food the world grows; whether production entails sustainable management of natural resources; and how that food is distributed at the global, regional, national, and household levels. These concerns have been prominent in bringing about concerted efforts and international commitments, such as the World Food Summit’s Plan of Action (FAO 1996a), the Millennium Summit’s Millennium Development Goals (United Nations 2000), and IFPRI’s 2020 (IFPRI n.d.) Vision. The concerns have succeeded in increasing resource flows to agricultural development, improved food security, and better nutrition.

Increasing acknowledgment of other food problems has placed the discussion of the food system in a much broader context. These problems include human health concerns related to food safety and the growing incidence of nutrition-related illnesses, especially cardiovascular diseases; the commercialization and industrialization of food and agriculture; the penetration of new technologies with potentially positive or adverse economic and environmental impacts; the rise of transnational corporations in international food markets; increasing concentration in food production, processing, and retail; the acceleration of instability and armed conflicts; and ethical issues related to food. Among the environmental challenges affecting the food system are climate change, the depletion of natural resources, salinization, pesticide runoff, GMO concerns, and biodiversity problems associated with monocropping (Timmer 2009). Each of these problems crosses traditional disciplinary borders, making the study of the food system itself a valuable and important endeavor. The chapters of this book address these topics.

The food problems now facing the world are both diverse and complex. Yet much of the debate and evidence available to decision makers fail to take into account such diversity and complexity and instead present simpleminded arguments to sensationalize the extent of existing food problems while making doomsday predictions for the future. Short-term fluctuations in food production and resulting food price spikes are often misinterpreted as long-term trends. In particular, much of the news media interpreted the abrupt food price increases in the international market such as those that occurred in 1974, 1996, 2007–2008, and 2010 to mean that the earth’s productive capacity was insufficient to feed current and future generations. Subsequent falls in real food prices demonstrated the fallacy of the interpretation, yet were not widely reported.

Book titles such as The End of Food (Roberts 2008), Food Wars (Lang and Heasman 2004), The Food Revolution (Robbins 2001), Stuffed and Starved (Patel 2007), and Fearing Food (Morris and Bate 1999) may catch the attention of the news media, the public, and decision makers. However, the sense of fear and panic these titles convey may lead to inappropriate action, misallocation of resources, and loss of confidence in the evidence presented. Other recent books such as The Omnivore’s Dilemma (Pollan 2006) and In Defense of Food (Pollan 2008) promote the consumption of locally produced food; while books such as Just Food (McWilliams 2009) question whether emphasis on locally produced food is an environmentally sound strategy; and still others such as Food Politics (Nestle 2007) aim to illustrate the influence of the food industry on food systems. A more comprehensive assessment of the challenges facing the global food system and of proposed solutions is provided by Ending Hunger in Our Lifetime (Runge et al. 2003). These books and many more contribute to the debate about the current and future food situation.

Goals and Purposes

In this book we attempt to capture the food system diversity and complexity and the implications for action by situating questions in a food systems context, questions such as: What are the causes of existing food problems? How severe are these problems and whom do they affect? Why do they persist? What are the links among the various parts of the food systems? How can policy analysts determine which solutions will be most effective in which context? What are the roles of government, civil society, and the private sector in a systems conceptual framework? The focus of the book is on identifying policy options available to governments, how such options affect the various stakeholder groups, and how they interact with the various elements of the food systems. Thus, the concept of food systems used in this book covers several more narrowly defined concepts such as agricultural, environmental, health, and nutrition policies in an attempt to capture the interactions among these components of a food system.

We define a food system, in its most general sense, as the aggregate of all food-related activities and the environments (political, socioeconomic, and natural) within which these activities occur. This chapter discusses the evolution of the food systems concept, identifies its primary components, and briefly discusses some of the most influential factors expected to drive global, national, and local food systems over the next several decades.

The next chapter is similarly foundational, explaining that public food policies emerge from a complex interaction of stakeholder groups and different government agents. Thus stakeholder analysis and political economics are tools needed to understand how food policies are created, both their intended and unintended effects, and how to craft better policy.

Because the food system contains many feedback loops, it is not linear and has no unique beginning or end. It is frequently argued that a food system begins with the combination of resources such as land, water, labor, and capital for the purpose of food production, and ends when the food is consumed. However, the availability and efficiency of resources used (e.g., labor efficiency) and agent behavior are influenced by the outcomes of the food system (e.g., the extent to which nutritional needs are met). It could therefore be argued that the food system begins and ends with what we refer to as outcomes, particularly human health and nutrition.

We therefore organized the chapters to discuss first the principal purposes of the food system (chapters 3–5), followed by the means by which the world achieves these purposes (chapters 6–7), and the biophysical, institutional, and international environments within which food systems operate (chapters 8–10). Thus, we treat the health and nutrition aspects of the system in chapter 3, food security and demand in chapter 4, and poverty in chapter 5. We follow with a discussion of the market and exchange functions in chapter 6 and production and supply in chapter 7. We present natural resource management and climate change policies in chapter 8, governance and institutional issues in chapter 9, and globalization and international trade in chapter 10. Ethical considerations, which affect all parts of the food systems, conclude the book (chapter 11). Relevant policy issues and options are discussed in each chapter.

Toward a Global Food Systems Approach

Historically, commentators have considered the food system as a set of activities that produce food products and meet consumer demands. Phrases such as from farm to fork or farm to table are common. In this linear, one-dimensional model (the input-output model), the food supply chain is treated as a neutral, static tool. Though still useful for some purposes, the model’s inability to address many of the current world’s food problems signals the need for a new paradigm (Waltner-Toews and Lang 2000).

In an attempt to move toward such a paradigm, we propose a systems approach to the analysis of food and food policy. Within this system are biophysical, socioeconomic, demographic, and political subsystems that need to be identified and related to each other in complex, nonlinear ways. The food system may then be studied in a holistic manner utilizing methodologies from many disciplines including economics, nutrition and medicine, soil science, sociology, anthropology, political science, demography, environmental science, and geography.

All elements in the food system function together as collective units. The food system thus creates emergent properties greater than the sum of their parts (chapter 2). In this book, we visualize the food system as a dynamic, behavioral system affected by social and economic changes brought about by public policy and action by the private sector and civil society as well as forces such as globalization, urbanization, and technological advancement. Adding to these changes are persistent problems, including poverty, hunger, and malnutrition, climate change and other environmental concerns. Within this context, we identify policy opportunities to improve people’s well-being.

Changes in food systems may be rapid or glacially slow. They are nearly always complex, involving uncertainty and unknown consequences. The interlinkages among the food system components create further feedback effects so that changes ripple throughout the system, possibly compounding and magnifying each other. This context of change, uncertainty, and complexity poses considerable research and policymaking challenges to understanding where, when, and how to change the global food system and its environments so as to produce greater equity, reduce hunger, and assure the sustainability of the food system and the freedom of its agents.

The Systems Approach

The systems approach is a method of analyzing organizations and interdependent relationships within a complex entity. Systems describe a set of linked elements and how they interact. Examples of elements in the global food system include individual farmers and groups of farmers, government organizations, market systems, food safety, technology, feeder roads, consumers (both at an individual and group level), soil fertility, and zoonotic diseases, to mention a few. These elements interact through various processes, such as purchases, deforestation, infection, metabolization, marginalization, and regulation. These processes alter elements’ states, changing consumers from hungry to full, for example, or a local water source from potable to polluted. Time is therefore an essential dimension in systems analysis. Most systems are nested, with multiple subsystems that (potentially) interact to form a more complex whole.

Some of these processes happen passively, such as metabolization or infection. Most processes, however, occur deliberately at the instigation of human agents. Agents are decision makers, including producers, consumers, traders, policymakers, and others, who influence how the elements interact with each other. Humans are thus both agents and elements, affecting and effected by the food system. Many of the questions to be addressed in this book deal with how food systems influence those people who have little influence over it.

Because most of the processes are deliberate, they can be changed by human choice and action. Ensuring that these changes bring about the ends societies or stakeholder groups want requires knowledge and education at individual, societal, and government levels. We aim to strengthen such knowledge and education through this book.

When a system is open, it interacts with its outside environment through inputs that enter the system from the outside and outputs that leave the system. The environments here considered include the natural environment, as well as the social, political, community, and individual contexts in which food system processes occur. A permeable boundary separates the system and its environments.

The systems approach addresses complex problems that have multiple causes and multiple outcomes brought about by interactions among the interdependent elements within a system. In contrast to traditional forms of analysis that focus on individual pieces, the systems approach takes into account the whole system of inputs, interactions, outputs, feedback, and controls. Rather than trying to remove complexity, the systems approach embraces interconnectedness in order to identify the critical factors that lead to particular outcomes or the interactions that govern a specific behavior of interest (Ericksen 2007).

The concept of a food system elaborated in this book is best understood as a mixture of the conceptual frameworks in the disparate literatures, which are summarized in the following section, uniting different disciplinary perspectives (e.g., biophysical, social, economic, political, etc.; see Scoones 1999). This approach renounces the narrow separation of different disciplines that forms the basis of much of modern research. Its comprehensive nature means that the food system includes all activities, critical interactions, and factors influencing outcomes, as well as the environments within which they take place. In addition, the framework is generic enough to allow its universal application to widely different contexts. The same basic categories of food-related activities exist in any food system, as do the primary objectives of food systems, e.g., food security, freedom from poverty, and improved human health and nutrition. However, the conditions under which elements interact can differ, which affects whether or not these goals are equitably and universally achieved and what needs to be altered so that they can be.

Conceptual Framework

Applications of a systems approach abound in the literature but are nonetheless fragmented among a number of different scientific disciplines, such as nutritional and agricultural sciences, sociology, economics, and environmental studies. In most contexts, the term food system describes the elements and processes that produce food and nutrients for human consumption. For example, Sobal, Khan, and Bisogni (1998, 853) define the food system as the set of operations and processes involved in transforming raw materials into foods and transforming nutrients into health outcomes. Whether regarded as linear processes (food chains) or more complex food webs where each element in the chain interacts with all the others, the relevant elements are only those directly involved in producing and consuming food.

There are several competing conceptualizations of how the food system functions within its ecological environment. An agroecosystem approach adds ecological concerns to a standard food web, accounting for feedbacks between food processes and environmental quality. The 1992 Rio Earth Summit Convention on Biological Diversity describes the ecosystem approach as a strategy for the integrated management of land, water and living resources that promotes conservation and sustainable use in an equitable way (Holling 2001; Carpenter et al. 2001). While the ecosystem approach ranks environmental sustainability as the first priority, with agriculture being one of the activities that influence the environment for good and ill, integrated natural resource management unites several approaches so that livelihoods, agriculture, and environmental quality each receive high priority.

Rural sociologists embedded political, economic, and social structures in the food system (Arce and Marsden 1993; Fine 1994; Dixon 1999; Lockie and Kitto 2000; Goodman 2002). The term agro-food network is frequently used to refer to this sociological view of the food system. Early research on agro-food networks incorporated farmers into agro-industrial commodity systems, taking into account policies, regulations, and economic factors (Ericksen 2007). Issues studied include increasing food market concentration (Wilkinson 2002) and globalization versus localization of food systems (Nygard and Storstad 1998; Hendrickson and Heffernan 2002a).

Figure 1.1 depicts the conceptual framework of a food system used in this book. Each chapter will highlight a specific subsystem from this figure, expand on it in greater detail, and discuss interactions with other subsystems. Specifically, the food system includes biophysical, socioeconomic, politico-institutional, and demographic environments within which the food supply chain operates to produces certain outcomes (e.g., contributions to the environment, the economy, human health and nutrition, etc.). These environments affect decisions within the food system activities, and food system activities in turn affect their environments. These changes alter the stock of resources, the institutions, the environments, and the stakeholder groups that will act in the food system in the future.

The Global Food System

Agents—or stakeholder groups, as we call them in this book—in the food system include resource owners, farmers and farm laborers, traders, processors, consumers, investors, policymakers, policy analysts, officials in government and nongovernment organizations, and others from the public and private sectors and civil society. These agents respond to incentives (opportunities, challenges, and risks) and environmental constraints. As such, the food system is a dynamic, behavioral system that can be influenced by public policy through incentives, regulations, and knowledge generation (Pinstrup-Andersen 2006a). The food system must be perceived and understood as an economic, physical, and social system. The reader is referred to Goodman (2002) and Dixon (1999) for a detailed description of the links between the production and consumption sides of the food system, and to Gunderson and Holling (2002) for theoretical underpinnings. The food industry, which is defined by Nestle (2007) as companies that produce, process, manufacture, sell and serve foods, beverages, and dietary supplements, occupies a large share of the total food system activities and possesses very large influence over its conduct and performance.

FIGURE 1.1.

A conceptual framework of a food system.

For ease of discussion, let us start with the food chain as traditionally delineated: the production, distribution, and consumption of food. The food chain starts with natural and planned production (chapter 7). Hunters, fishers, and gatherers harvest natural production, while farmers organize inputs (e.g., soil, fertilizer, water, livestock, feed) to produce food commodities. These commodities may be consumed by the producing household, stored for later use, or sold to other households or to traders and processors.

Processors combine and alter food commodities to reduce the time households must spend in such activities. Available food supply reaches consumers by multiple distribution channels (chapter 6). It is during the distribution stage that consumer demand meets producer supply, generating price signals that balance both forces. Food prices may be influenced by action taken by the public and private sectors.

The food chain may be relatively short (e.g., consumption of own production, farmers’ markets), or food may pass through many links as it is traded, transported, processed in several different facilities, further transported to wholesale distribution centers, and sold at retail to households or to institutions that prepare food for final consumption. These institutions include hotels, restaurants and caterers, community centers, soup kitchens and food pantries, government facilities, hospitals, school cafeterias, and vending machines. Together these channels are often referred to as HRI: hotels, restaurants, and institutions.

The process of consumption includes not only acquiring and preparing food (chapter 4) but its distribution among household members, ingestion, digestion, and metabolization as well. Thus, the final stages of the food chain are the first stages of the nutrition cycle as the body turns prepared foods into nutrients (chapter 3). This occurs at different rates for each nutrient in each person at different times, so consumption and bioavailability are not synonymous.

The seemingly closed food chain just described is actually a communicative process that interacts with outside demographic, socioeconomic, biophysical, political, and international environments. The demographic environment includes the population’s age distribution, gender composition, physical status, activity level, lifestyle, and genetic characteristics (chapter 4). The socioeconomic environment (chapters 5 and 6) includes labor, capital, markets, and social institutions and culture. The biophysical environment (chapter 8) includes physical forces (e.g., climate and energy), physical materials (e.g., soil and water) and biological factors (e.g., biodiversity). The policy environment refers to government regulations and policies, governance structures, formal institutions, and politics (chapters 2 and 9). For national and local food systems, there is also an outer environment that governs how a particular food chain and its environments interact with others, such as by international trade laws or competition between localities to host a new factory farm (chapter 10).

The interaction between food system activities and their environments can be illustrated by the example of a maize farmer in Mexico. The amount of maize that can be produced and the price received for it will be influenced by the physical environment (land quality, rainfall), market access to inputs (improved seeds, fertilizer, water), domestic laws and social norms on land tenure, potential government subsidies, transaction and market costs, and international trade laws, such as NAFTA.

Complexity

Despite the simple illustration (figure 1.1), the food system introduced above is complex, dynamic, filled with heterogeneous subsystems, and affected by nonlinear feedbacks (Ericksen 2007). The nonlinearity of its feedbacks means that a small shock may have one or several effects:

1. Amplification, as when increased production lowers prices, which spurs farmers to sell even more in an attempt to keep income stable, lowering prices further;

2. Proportionality, as when a farm laborer receives a wage increase that is then spent in the community so that other incomes in the community rise proportionately;

3. Dampening, as when increased demand for biofuels increases the amount of land devoted to growing maize and decreases the land for other crops, which in turn increases the prices for those other crops so that some farmers return some of the land to producing these other crops;

4. No effect at all, as when a government pollution mandate forbids a certain production technology, but firms respond by using a different technology that is just as polluting.

In contrast, linear system effects are always directly proportional to cause.

The global food system is made up of local and national food systems. Wilkins and Eames-Sheavly (2010) have defined a local food system as a food system in which food production, processing, distribution and consumption are integrated to affect the environmental, economic, social and nutritional health of a particular locality. Local food systems are rarely completely self-contained: there are generally significant trade, labor, environmental, and technology links with other food systems. A food system may be defined geographically or politically (e.g., a neighborhood, province, or nation) or by other boundaries, such as by ethnic or religious groups whose social institutions create different interactions between elements. A national food system extends the concept of the local food system to a national level.

A holistic perspective of the global food system believes that significant information is lost when any national or local subsystem is considered in isolation from all others. Instead, these subsystems interact to exhibit novel properties at a higher (global) level that are not found in the subsystems themselves. The different component processes in the global food system also produce emergent properties together that would not be observed in isolation. Schroeter, Azzam, and Zhang (2000), for instance, incorporate interactions between growing concentration in the meat processing industry with growing concentration in food retail, finding that the latter offsets processors’ possible market power (chapter 6).

Subsystem Diversity

The global food system is not a homogeneous entity. Nested food systems may be as small as a household or as large as a nation. Even within a level, these subsystems differ widely. For rural communities in developing countries, the local food system is still the dominant one, while usually interacting with outside food systems in different ways. In most developing countries, food continues to be produced by small-scale farmers (including livestock farmers or pastoralists and fishermen) to be sold, processed, and consumed locally, providing the foundation of the community’s nutrition, incomes, and economies. The more integrated the locality is, the more national and international factors ripple through to the micro level.

Local food systems differ based on the importance of food and agriculture. The majority of the world’s poor live in rural areas of developing countries and most of them depend directly or indirectly on agriculture (World Bank 2007a; see chapters 5 and 7). Food expenditure accounts for a large share of their total income, often as high as 60–80 percent. In contrast, budget shares for food in high-income countries are low, often around 10 percent. The contribution of agricultural GDP to total GDP¹ is much higher in developing countries than in high-income ones. It is not unusual to find more than half of the population of a low-income developing country deriving their incomes from agriculture.

Local food systems also differ in their environmental contexts (WTO 2001): soil fertility and climate, religious norms and traditional roles of women, land tenure laws and labor costs are just a few examples. Some food systems may face more costly or variable production conditions than others because of factors such as degraded soils, low or erratic rainfall, small subsistence farms, underdeveloped infrastructure, or limited access to new technologies. Differing production conditions alter the costs of production even within small countries or areas.

These different conditions affect not only the production aspects of the food system but also how the food chain interacts with human health and nutrition, income distribution, gender roles, and governance. For instance, the optimally efficient size of a wheat farm is significantly smaller than for a sugarcane farm. This promotes the development of household farms in areas that are biologically suited for wheat and plantation-style farming in areas that are better suited for sugarcane. Easterly (2007) demonstrates that this difference in agricultural suitability led to differences in income distribution, government policies, and public goods provision that persist today. In a similar vein, Boserup et al. (2007) argue that societies that adopted agriculture by plow developed predominantly male agricultural systems while societies that did not use the plow feature significant female labor.

Agricultural development can more readily produce widespread poverty alleviation and income growth in areas where land is relatively abundant and evenly distributed (as in much of Africa and some parts of Asia) than where land is scarce or concentrated (as in India or much of Latin America). Institutions develop to support landholders, whether they are relatively many (supporting equality) or few (preserving inequality). The distribution of agricultural development’s benefits depends on which crops are grown and by whom within the household.

Food consumption behaviors tend to depend on income. Poor consumers spend a greater portion of their food budget on low-value staples, such as root crops and cereals. As incomes increase, people spend more on high-value food items, such as dairy and meat, and demand for food quality and safety increases as well. Increasing food quality similarly increases prices, so that poor consumers may have to choose between safer but insufficient quantities of food and access to more food that is less safe. Poor people tend to prioritize quantity until their basic nutritional requirements are met, even if it implies lower levels of food safety (Pinstrup-Andersen 2002a, 25). Many OECD countries have enacted stringent food safety requirements that increase prices for relatively small risk reductions.

In addition to higher food safety and health standards, higher-income consumers and societies are likely to pay more attention to the impact on natural resources. Sustainability goals become more prominent. Pollan (2006) refers to this as a movement from the industrial to the pastoral food chain, and Lang and Heasman (2004) argue that we are witnessing a paradigm shift from what they call a Productionist Paradigm to an Ecologically Integrated Paradigm.

Different subsystems face different problems and to varying degrees. In some areas, the primary cause of hunger is a lack of food production, while in other areas what is lacking is the ability to purchase available food. The policy solutions to these two problems are vastly different. The policy solutions to hunger and obesity are also vastly different, making it difficult to combat the rising epidemic of obesity in many countries in Asia and Latin America where both undernutrition and obesity may be found in the same family. HIV/AIDS, malaria, and tuberculosis pose a more serious threat to the food systems in some African countries than in many other parts of the world.

The market and political power of farmers and consumers change with national income. In general, as countries become wealthier and the percent of the workforce involved in agriculture decreases, farmers organize themselves to lobby for government support. Poor countries’ governments therefore tend to tax their farmers to benefit urban centers while wealthier governments tax urban areas and subsidize farmers. Even though farmers’ political power tends to increase with national income, their market power decreases as consumer demands and processor requirements shape production choices (Pinstrup-Andersen 2002a).

Complex Systems Analysis

The issues now facing food policymakers are rooted in complex interactions inherent in the food system and the broader socioeconomic context within which it operates. Lang, Barling, and Caraher (2001) and Waltner-Toews and Lang (2000) propose that issues related to food, agriculture, health, environment, and society cannot be satisfactorily addressed unless considered in a holistic manner. This implies that policy goals need to be considered jointly rather than in isolation.

Although many accept the existence of this complex system, few agree that there is a good way to study it or apply it to real-world problem solving. This is largely because experts tend to be specialists and to focus within their specialization. The gains to multidisciplinary work are not seen in part because they are not considered. As the World Bank (Gittinger, Leslie, and Hoisington 1987, 4) puts it, Agriculturists tend to focus on production, those active in the commercial food sector on market improvement, and physicians and nutritionists on clinical aspects of health and nutrition. In similar fashion, economists focus on micro or macro economy, environmentalists on natural resources, and biotechnology researchers on the technical aspects of GMOs. Government ministries and international agencies suffer from similar disciplinary biases.

This book puts together several elements to assist in solving these complex problems. The case studies that support this book offer an opportunity to get a more holistic understanding of policy issues and options available to the policymaker in a manner that is readily accessible by multiple disciplines (Pinstrup-Andersen and Cheng 2009). We encourage readers to approach complex problems with a strong disciplinary background while being cognizant of how that discipline’s tools and particularly its biases and blind spots fit into the overall picture, open to the work and insight from other disciplines, and prepared to work across disciplinary lines to resolve complex issues. Such an approach is exemplified in this book as themes from one chapter spill over into the other chapters, illustrating the interconnectedness of food policy analysis. The next chapter provides additional tools to assist in solving complex problems by considering food system problems from the point of view of varying stakeholder groups, a methodology that underpins the rest of the book and the case studies.

The Complex Systems Approach focuses specifically on the interactions and relationships between elements of a system that would not be recognized by concentrating solely on the elements. It has its beginnings in the Austrian school of economics, arguing that market systems demonstrate emergent orders—systemwide phenomena that are not present in any individual part, developing without a plan or an overall decision maker dictating those results (Hayek 2007; Galea, Riddle, and Kaplan 2009). The approach is dependent on an extended knowledge pool and peer group for quality control (Funtowicz and Ravetz 1993). Emergent properties have been found in flocks of birds and herd behavior (Reynolds 1987), in the fact that the properties of water cannot be accounted for by the properties of hydrogen and oxygen alone (Galea, Riddle, and Kaplan 2009), in the formation of communities (Palla et al. 2005), and in political organizations (Cederman 2002). Indeed, Galea, Riddle, and Kaplan (2009, 4) comment that the appearance of emergent properties is the rule and not the exception.

In his 1974 Nobel Prize lecture, Friedrich Hayek explained that scientific models of complex systems could predict only patterns in emergent orders, not specific outcomes as is possible in simple systems:

Unlike the position that exists in the physical sciences, in economics and other disciplines that deal with essentially complex phenomena, the aspects of the events to be accounted for about which we can get quantitative data are necessarily limited and may not include the important ones. . . . In the study of such complex phenomena as the market, which depend on the actions of many individuals, all the circumstances which will determine the outcome of a process . . . will hardly ever be fully known or measurable. (Hayek 1974, 1)

Food systems, because of their complexity, likewise rely on a great deal of information that is not known or measurable even to an aggregate group of experts from the diverse fields that study the food system, let alone to those of only one profession. Because the immeasurable parts of a complex system cannot be verified empirically, it is common for analysts and policymakers to therefore ignore them. This can have tragic results.

The complex model thus offers a richer and potentially more effective basis for public policy than the single-discipline model, but also one that is more sober and modest. With fewer pretensions to understanding all facets of a problem, it can nevertheless provide readier policy guidance for supporting emergent orders and encouraging them to desired channels while harnessing their seemingly chaotic structure to improve efficiency and distribution.

Thinking in the food policy literature has been slowly moving in this direction, but it has been a very gradual change. Work by Schuh (1974) on exchange rates, and Krueger, Schiff, and Valdes (1988) on pricing policies, shows that macroeconomic policies may be as important for the food system as sectoral policies. An integrated approach to food policy that includes agricultural and resource policy will hold the most potential because of increased benefits from policy coordination (Timmer, Falcon, and Pearson 1983; Gittinger, Leslie, and Hoisington 1987; Just and Bockstael 1991). Epidemiologists have also called on their colleagues to make use of the complex systems methodology in studying public health (e.g., Koopman and Lynch 1999), particularly obesity (Hammond 2009; Galea, Riddle, and Kaplan 2009).

The central assumption for the new model is that an agrifood system should be treated as a complex system in order to be sustainable. Not only do practitioners of various disciplines need to work together to study complex systems, but scientific inquiry across disciplines needs to be brought into the same arena with public policy and management so that systemic feedback loops and trade-offs can be explicitly incorporated and negotiated.

In its simplest form, complex systems analysis begins with developing a conceptual framework, as in figure 1.1, that shows the primary elements and their linkages. This provides a reference and organizational tool to consider what factors interact with each other and how the most important feedback loops can be identified, as well as amplifying or dampening effects. From that vantage point, each element of the system can be examined with its connections included. Similarly, each chapter of the book delves into one portion of the conceptual framework deeply while recalling issues from other chapters that impact it.

Empirical complex systems simulations are generally accomplished through computer simulations. Stakeholders are modeled with relatively clear goals or rules of behavior: farmers