Three stories, many variables: the case of small farm productivity

Features

  • Author: Chris Smaje
  • Date: 05 Mar 2015
  • Copyright: Copyright: Chris Smaje

The pioneering Russian economist A.V. Chayanov was among the first to describe what has come to be called the ‘inverse productivity relationship’. This is the finding that small farms tend to have a greater per acre output than larger ones, a result that’s been widely – though not universally – replicated in studies throughout the world up to the present day wherever a small-scale or ‘peasant’ agriculture persists.

In order to elucidate the inverse relationship empirically, most researchers follow standard procedure in social statistics: obtain a cross-sectional dataset of relevant cases (in this instance, farms) and use multivariate analysis techniques of the appropriate kind to determine the extent to which variation in the dependent variable of interest (output) is associated with (or in sloppier parlance is ‘explained’ by) several independent variables. Numerous such independent variables have been addressed by the relevant studies, including labour inputs, land quality, irrigation, microclimate, proximity to markets, capital and credit inputs, tenure, and demographic characteristics of the farmer.

thumbnail image: Three stories, many variables: the case of small farm productivity

Before considering these results, I want to take a step back and ask why the inverse relationship matters. Or, to put it another way, why should anyone set out to describe and then ‘explain’ it, and what does one commit oneself to in purporting to have ‘explained’ it? As is typically the case in social science, those who have looked at the issue are rarely indifferent to the political implications of their findings. In fact, students of the inverse productivity relationship have typically fallen into one of three mutually antagonistic camps.

Chayanov himself was an important figure in the formation of agrarian populist thought – broadly, the view that countries with large peasant populations should adopt policies which support the maintenance of peasant farms and the wellbeing of peasant farmers. His research suggested that the productivity of peasant farms stemmed from the application of labour to them at levels that could not be economically justified on commercial farms, particularly at certain points in the demographic cycle, because peasant lifeways were oriented to the survival of the family and its farm, and not to any particular level of fiscal return. He used this to question the universality of behavioural models in western economics, which posit ‘rational’ worker behaviour in relation to time input and fiscal reward.

It’s worth noting that there is an unaccented agronomic dimension to this labour theory of inverse productivity – extra labour is assumed to produce extra output, but it’s not clear what the extra labour actually does on the farm to secure the output. In his classic study of ‘agricultural involution’, Clifford Geertz argued that it involves fine-comb cultivation techniques such as transplanting rather than direct seeding, extra hand-weeding etc [1]. Others have pointed to more complex mixed cropping strategies, which also emerge from historical studies of intensive peasant land use in circumstances of land constraint [2]. Such agronomic dimensions have not been well investigated in the inverse productivity literature. For Geertz, the involution of labour-intensive peasant cultivation represented a kind of subsistence trap. For the populists, on the other hand, there is no trap: maintaining the family farm is simply what you do. Nevertheless, it’s easier to argue for government policies to support peasant farming if you can show that it’s more productive, so the inverse productivity relationship becomes a useful piece of evidence in the populist armoury. But the relationship is not a necessary precondition for adopting populist support for small farms.

Not so for the second school of thought – that of mainstream capitalist or ‘neoclassical’ economics. This takes no particular view as to what the right scale or kind of farming is, but it does take an (implicitly normative) view concerning efficiency: policy should support that combination of inputs (land, labour, capital) which furnishes maximum output for given input costs. In a properly functioning market, there should be constant returns to any particular input, so the empirical finding of an inverse productivity relationship suggests market imperfections. Just how those imperfections can and should be resolved is open to debate – some of those writing within the neoclassical tradition caution against the temptation to “naïvely interpret the existence of the inverse relationship as prima facie evidence in favour of land redistribution” [3]. Nevertheless, one strand of development economics has had the courage to go ‘naïvely’ where the data appear to take it. Since the 1970s, various analysts have supported redistribution in favour of the apparently more efficient small farm in a melding of economic efficiency arguments with advocacy for peasant cultivators which has been dubbed ‘neo-classical neo-populism’.

That epithet was coined by Terence Byres [4], a representative of the third school of thought – Marxism. Marxists typically complain that the other two approaches are ahistorical in taking for granted essentialist categories such as ‘the peasantry’ or inputs such as ‘land’, rather than seeing these as unstable historical relations. In particular, ‘the peasantry’ for them is always internally divided and on its way to becoming something else – rich peasants becoming capitalists and poor peasants becoming landless labourers, thus replicating the capital-labour tension which Marxists see as the core historical contradiction towards which all other relationships ultimately converge. The extra productivity furnished by extra labour on the peasant farm is therefore not some timeless actuality of the peasant way of life, but emerges from a class-based struggle over resources. It is, in Graham Dyer’s words, “misguided to treat the inverse relationship as a sign of relative efficiency rather than of distress” [5].

...perhaps of greater methodological interest than which perspective finds greatest support from the empirical data is the way in which theoretical commitments to one or other of them colours the interpretation of the evidence.

It’s worth noting that although the Marxist approach introduces a welcome note of historical relativity into the inverse productivity debate, its historical approach is a very singular one derived a priori from a theoretical commitment to linear progress in history from ‘backward’ (Dyer’s word) high labour-low capital input peasant farming to more ‘advanced’ capitalist farming, and presumably in the end socialist farming as the most advanced developmental stage.

That, at any rate, sketches the basic positions that analysts have taken in the inverse productivity debate. But what does the data tell us? Needless to say, the complexities of the real world do not align neatly with any single one of the three theoretical narratives I’ve outlined, and indeed it’s likely that their relative plausibility is place and time specific. Studies have variously emphasised the labour input/output relationship, market imperfections, land and soil quality and farmer demographics to account for the relationship, whereas other studies equally have found that the relationship still holds after controlling for such factors – including an interesting analysis which looked at the size-productivity relationship within given farm households and found that it held true at the intra-household level, thereby arguably eliminating the play of most independent variables from case to case across farms [6].

But perhaps of greater methodological interest than which perspective finds greatest support from the empirical data is the way in which theoretical commitments to one or other of them colours the interpretation of the evidence. Here I’ll briefly mention four such dimensions.

The first is the measure of output. Some studies measure this in terms of the farm’s actual or virtual (shadow price) earnings, whereas others use direct output measures, usually the yield weight per unit area of a key staple crop. Fiscal measures of the former sort have the methodological advantage of providing a universal comparative metric across the farm’s total product mix (permitting comparison of the proverbial ‘apples and oranges’), although biases can be introduced in the construction of indices based on market prices or shadow prices. But within the neoclassical and Marxist frameworks, these measures also have normative implications – all else being equal, higher fiscal output indicates a less ‘backward’ farm, which is desirable in itself. Measures of yield are more direct and less subject to bias in their construction. But a strong focus on single crop yields may miss wider agronomic dimensions of the farm product mix and fail to capture total farm productivity, which typically involves a wider mix of products. Focusing on single staple crops, some analysts argue that the inverse relationship breaks down in the context of newer technologies such as high-yielding green revolution crops [7]. As I’ve argued elsewhere [8], the consequences of the green revolution remain moot – particularly from longer-term perspectives such as energy return on investment and secular yield declines. Populists may be inclined to question the narrow terms by which increased output may be defined.

The second dimension is the association between labour input and farm output. Inasmuch as the inverse relationship reflects an underlying association between labour input and farm output, it’s possible to present it as an artefact of labour exploitation – a conclusion drawn by writers both within the neoclassical tradition, who emphasise the scope for a different and more efficient input combination, and within the Marxist tradition, who emphasise the historical role of class conflict in conditioning the labour-productivity relationship. It’s worth noting that the idea of a statistical artefact involves a theoretical judgment, indeed a value judgment: if the size-output relationship is mediated by labour input (itself an indirect measure of agronomic variables), the relationship is only ‘artefactual’ if one wishes to accord some kind of explanatory primacy to labour. Of course, this is an explicit tenet of Marxism, but it is not the only possible approach. From a populist perspective, one could accept Marxist strictures against landlordism as a driver of the inverse relationship without abandoning support for labour-intensive small-scale farming, and one could further seek to probe behind the labour-productivity relationship for the underlying agronomic character of output intensification which could be redeployed in a different political context of labour relations and capital inputs. Evidence that the inverse relationship may follow an ‘S’-shaped curve (ie. that the relationship is positive at the smaller and larger ends of the farm size distribution) arguably provides at least prima facie support for a populist ‘middle peasant’ strategy [9].

The third dimension is the question of historical change, which Marxists make a particular point of addressing in decrying the ahistorical character of ‘neo-classical neo-populism’. In the words of Terence Byres,

“To be ahistorical is to run the risk of failing to see history changing before one’s very eyes. That is precisely the case with [neo-classical neo-populism]. Not only does one have a strong sense of déjà vu, one also has a sense of circumstances being addressed, which, if they ever existed, are clearly in the past. They are déjà passé” [10].

But this criticism can be turned back on itself. The notion that progress follows a single historical trajectory, with peasants necessarily giving way to proletarians and thence to a socialist-industrial emancipation, lacks historical credibility. Instead, the social and environmental destructiveness of large-scale, commercialised, capital-intensive farming is becoming increasingly apparent, and broad social movements are arising under the banner of food sovereignty such as the Landworkers’ Alliance in the UK and Via Campesina internationally which argue for the relevance of a small-scale, locally-oriented and labour intensive agriculture to address contemporary problems [11]. In this respect Marxist presentiments about the historical eclipse of small-scale farming may themselves turn out to be déjà passé. Still, it may be true that naïve forms of populism fail to recognise the internal tensions within small-scale farming societies out of which further cycles of social differentiation and capitalist development can occur. Some of the most interesting recent work in political sociology explores this conundrum in tracking the various routes to economic power taken by different polities historically in relation to the agrarian basis of their rise to power [12]. For my present purposes, I just want to suggest that historicising a cross-sectional relationship between farm size and productivity need not involve any singular notions of historical ‘progress’ that imply negative judgments as to the ‘backwardness’ of small farms.

The final dimension is endogeneity – in other words, the possibility that the relationship between plot size and productivity is confounded by another association between plot size and comparative disadvantage in crop production. A study of maize farming in Zambia reports a significant endogeneity effect, from which it is inferred that the strength of the inverse productivity relationship is itself size dependent. This leads the author to posit a bimodal distribution of farm sizes (small subsistence holdings and large commercial holdings) and thence to proceed to a familiar neoclassical conclusion: the inverse relationship suggests market imperfections that require remedy for “improving the prospects of small farmers” [9].

It’s difficult to resolve the inverse productivity debate entirely through empirical research, because it’s difficult to disentangle methodology from theory in this area – even at the rather basic level of deciding what farming is actually for. Inasmuch as it’s for providing a secure supply of nutritious food year-round then perhaps studies are needed that complement fiscal output and yield measures with nutritional metrics. Careful attention must also be paid to the labour input – farm output relationship, including attention to the theoretical implications of purporting to ‘explain’ the latter in relation to the former. Further attention is also required to the agronomic differences between large scale and small scale farming. And in addition to the usual suite of independent variables, analysis of both endogeneity and intra-household as well as inter-household productivity would help to clarify the issues. That’s a demanding list of questions to pose for any data-gathering exercise, but if repeated widely enough around the different small scale farming systems of the world, it may go some way to settling the issue.

The analytical debates I’ve discussed here have been no mere academic exercises. Conflict between populist, Marxist and neoclassical approaches to the small farm have fuelled some of the most tumultuous currents of recent global history. The populist position outlined by the unfortunate Chayanov resulted in his early death in the Gulag as Stalin pushed the ‘déjà passé’ logic of Marxism to its extreme conclusion in the liquidation of Soviet peasantries. And the populism of many national governments in the aftermath of colonialism in Africa, Asia and Latin America has now largely succumbed to global free trade agreements which promote the neoclassical solution of eliminating market imperfections, often with the result of eliminating small farms along with them. Yet the persistence of small farms on the ground, and the persistence of the inverse productivity relationship in the analytical literature, suggests an intriguing resistance of the small farm to co-optation within the dominant currents of modern political and analytical thought. Who knows, perhaps the emergence of the food sovereignty movement will lead to a populist small farm renaissance which transcends the concerns for ‘progress’ underlying the intellectual eclipse of the small farm through the twentieth century.

References

[1] Geertz, C. 1963 Agricultural Involution, University of California Press.

[2] e.g. Rackham, O. 2012. Woodlands, Collins; Neeson, J. 1993. Commoners, Cambridge University Press.

[3] Barrett, C. et al. 2010. Reconsidering conventional explanations of the inverse productivity-size relationship. World Development 38, 1: 88-97.

[4] Byres, T. 2004. Neo-classical neo-populism 25 years on. Journal of Agrarian Change. 4, 1-2: 17-44.

[5] Dyer, G. 1997. Class, State and Agricultural Productivity in Egypt, Frank Cass.

[6] Assunção, J. and Braido, L. 2007. Testing household-specific explanations for the inverse productivity relationship. American Journal of Agricultural Economics 89, 4: 980-90.

[7] Dyer, G. 2004. ‘Redistributive land reform’ Journal of Agrarian Change, 4, 1-2: 45-72.

[8] Smaje, C. 2013. ‘Social statistics, counterfactuals and the green revolution’ Statistics Views, http://www.statisticsviews.com/details/feature/5410411/Social-Statistics-Counterfactuals-and-the-Green-Revolution.html

[9] Kimhi, A. 2006. Plot size and maize productivity in Zambia. Agricultural Economics 35: 1-9.

[10] Byres, op cit, p.37.

[11] Smaje, C. 2013/14. Peasants, food sovereignty and the Landworkers’ Alliance. The Land. 15: 29-31.

[12] Eg. Arrighi, G. 2009. Adam Smith In Beijing. Verso.

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