Nature and Scope of Agricultural Economics

 Agricultural economics is an applied field of economics concerned with the application of economic theory in optimizing the production and distribution of food and fiber products. Agricultural economics began as a branch of economics that specifically dealt with land usage.

n general, agricultural economics has contributed to the fields of research and training, smallholder and rural development, project planning and management, and the formulation, planning and analysis of macro-policy.

According to Snodgrass and Wallace, “Agricultural economics is an applied phase of the social science of economics in which attention is given to all aspects of problems related to agriculture.”

SCOPE OF AGRICULTURAL ECONOMICS

All the tools of analysis used in general economics are employed in agricultural economics as well. We have the same branches of agricultural economics i.e. economics of production, consumption, distribution, marketing, financing and planning and policy making as in case of general economics. A study at the micro and macro level for the agricultural sector is also generally made. Static and dynamic analyses are also relevant for the agricultural sector of the economy.

To be more specific, these definitions point out that agricultural economics examines how a farmer chooses various enterprises e.g., production of crops or rising of cattle and how he chooses various activities in the same enterprise. E.g., which crop to grow and which crop to drop; how the costs are to be minimized; what combination of inputs for an activity are to be selected; but amount of each crop is to be produced but type of commercial relation the farmer have to have with people from whom they purchase their input or to whom they sail their product.

Agricultural economics does not study only the behavior of a farmer at the farm level. That is, in a way, the micro analysis. Agricultural problems have a macro aspect as well. Instability of agriculture and agricultural unemployment are the problems which have to be dealt with, mainly at the macro level.

And then, there are the general problems of agricultural growth and the problems like those concerning tenurial systems and tenurial arrangements, research and extension services which are again predominantly macro in character. Such problems their origin, their impact and their solutions are all the subject matter of agricultural economics.

NATURE OF AGRICULTURAL ECONOMICS

Agricultural economics makes use of the principles of general economics. The first point to be noted with regard to the nature of agricultural economics is that, in general, it borrows most of its principle from its parent body of knowledge i.e., the general economics.

Even the main branches of agricultural economics are similar to those of general economics. But than a question arises. If the principles of general economics are not different from the principal of agricultural economics, why is there a need for separate study of agricultural economics?

The answer lies in the fact that agricultural economics does not merely imply a direct application of principles of economics to the field of agriculture. The principles of economics are too general in nature and the general theory of economics has been considered as an abstraction from reality.

Before this theory is applied to agriculture which includes, besides crop production, forestry and animal husbandry for the purpose of economic analysis, its principles have to be modified so that their postulates totally tally with the main features of the situation of obtaining in the agricultural sector.

Agricultural economics makes use of the principles of general economics. The first point to be noted with regard to the nature of agricultural economics is that, in general, it borrows most of its principle from its parent body of knowledge i.e., the general economics.

Even the main branches of agricultural economics are similar to those of general economics. But than a question arises. If the principles of general economics are not different from the principal of agricultural economics, why is there a need for separate study of agricultural economics?

The answer lies in the fact that agricultural economics does not merely imply a direct application of principles of economics to the field of agriculture. The principles of economics are too general in nature and the general theory of economics has been considered as an abstraction from reality.

Before this theory is applied to agriculture which includes, besides crop production, forestry and animal husbandry for the purpose of economic analysis, its principles have to be modified so that their postulates totally tally with the main features of the situation of obtaining in the agricultural sector.

SPECIAL FEATURES OF AGRICULTURE

Some of the outstanding features of Indian agriculture are mentioned as follows.

1. Subsistence agriculture:

Most parts of India have subsistence agriculture. The farmer owns a small piece of land, grows crops with the help of his family members and consumes almost the entire farm produce with little surplus to sell in the market. This type of agriculture has been practiced in India for the last several hundreds of years and still prevails in spite of the large scale changes in agricultural practices after Independence.

2. Pressure of population on agriculture:

The population in India is increasing at a rapid pace and exerts heavy pressure on agriculture. Agriculture has to provide employment to a large section of work force and has to feed the teeming millions. While looking into the present need of food grains, we require an additional 12-15 million hectares of land to cope with the increasing demands by 2010 A.D. Moreover, there is rising trend in urbanization. Over one-fourth of the Indian population lived in urban areas in 2001 and it is estimated that over one-third of the total population of India would be living in urban areas by 2010 A.D. This requires more land for urban settlements which will ultimately encroach upon agricultural land. It is now estimated that about 4 lakh hectares of farm land is now being diverted to non-agricultural uses each year.

3. Importance of animals:

Animal force has always played a significant role in agricultural operations such as ploughing, irrigation, threshing and transporting the agricultural products. Complete mechanization of Indian agriculture is still a distant goal and animals will continue to dominate the agricultural scene in India for several years to come.

4. Dependent upon Monsoon:

Indian agriculture is mainly dependent upon monsoon which is uncertain, unreliable and irregular. In spite of the large scale expansion of irrigation facilities since Independence, only one-third of the cropped area is provided by perennial irrigation and the remaining two-third of the cropped area has to bear the brunt of the vagaries of the monsoons.

5. Variety of crops:

India is a vast country with varied types of relief, climate and soil conditions. Therefore, there is a large variety of crops grown in India. Both the tropical and temperate crops are successfully grown in India. Very few countries in the world have a variety of crops comparable to that produced in India.

6. Predominance of food crops:

Since Indian agriculture has to feed a large population, production of food crops is the first priority of the farmers almost everywhere in the country. More than two-thirds of the total cropped area is devoted to the cultivation of food crops. However, with the change in cropping pattern, the relative share of food crops came down from 76.7 per cent in 1950-51 to 58.8 per cent in 2002-03.

7. Insignificant place to given fodder crops:

Although India has the largest population of livestock in the world, fodder crops are given a very insignificant place in our cropping pattern. Only four per cent of the reporting area is devoted to permanent pastures and other grazing lands. This is due to pressing demand of land for food crops. The result is that the domestic animals are not properly fed and their productivity is very low compared to international standards.

8. Seasonal pattern:

India has three major crop seasons.

(i) Kharif season starts with the onset of monsoons and continues till the beginning of winter. Major crops of this season are rice, maize, jowar, bajra, cotton, sesam, groundnut and pulses such as moong, urad, etc.

(ii) Rabi season starts at the beginning of winter and continues till the end of winter or beginning of summer. Major crops of this season are wheat, barley, jowar, gram and oil seeds such as linseed, rape and mustard.

(iii) Zaid is summer cropping season in which crops like rice, maize, groundnut, vegetables and fruits are grown. Now some varieties of pulses have been evolved which can be successfully grown in summer.



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