Assoc. Professor Dr. Diana KopevaUniversity of National and World Economy (UNWE)

MULTIFUNCTIONAL AGRICULTURE AND SUSTAINABLE DEVELOPMENT

ERASMUS IP Program19 June – 2 July 2011, Szent Istvan University, Godollo,

Hungary

2STRUCTURE OF THE PRESENTATION

The concept of multifunctionality The concept of sustainable

development Where and how these two concepts

are overlapped Future of multifunctional agriculture Group work

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MULTIFUNCTIONALITY OR MULTIFUNCTIONAL

AGRICULTURE The term “Multifunctionality of Agriculture” (MFA) covers a

wide range of different perceptions in research literature today

Multifunctionality is intended to call attention to the positive “goods” that agriculture can produce beyond the food and fiber that farmers sell in the marketplace

The positive goods can be defined very widely

Important to note that the concept of multifunctionality does not imply that these goods accrue automatically, as inevitable outcomes of any and all approaches to farming

These outcomes vary widely based on farming practices, farm size, farm location (by country, ecoregion, and local environment) and interaction of these variables

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SPECIFIC ASPECTS OF MULTIFUNCTIONAL

AGRICULTURE Viable Rural Communities

Environmental Benefits

Food Security

Landscape Values

Food Quality and Safety

Animal Welfare

5EVOLUTION OF THE

CONCEPT 1992 – Rio Earth Summit – the term “multifunctional agriculture”

emerged on the international stage

“. . .multifunctional aspect of agriculture, particularly with regard to food security and sustainable development.” (Agenda 21, Chapter 14)

1998 – OECD countries – expanded the idea of the Rio Earth Summit

“Beyond its primary function of producing food and fibre, agricultural activity can also shape the landscape, provide environmental benefits such as land conservation, the sustainable management of renewable natural resources and the preservation of biodiversity, and contribute to the socio-economic viability of many rural areas. Agriculture is multifunctional when it has one or several functions in addition to its primary role of producing food and fibre.” (OECD Declaration of Agricultural Ministers Committee)

6EVOLUTION OF THE

CONCEPT (2) 1998 – Multifunctional agriculture and the review of the

GATT Agreement on Agriculture (AoA) mandated for 1999

Two big conferences focusing on that issue and contraversial opinions

November 1999, FAO Conference “The Multifunctional Character of Agriculture and Land”, Maastricht, The Netherlands

<http://www.fao.org/docrep/meeting/X3577e.htm>

July 2000, conference on Non-Trade Concerns (NTCs) in Agriculture held in Ullensvang, Norway

<http://www.prosi.net/press8.htm>

7EVOLUTION OF THE

CONCEPT (3) OECD Definition

FAO concept

EU concept

8WHAT IS AGRARIAN

MULTIFUNCTIONALITY Two domains of agrarian multifunctionality:

a) The analytical one or activity oriented concept (OECD):

It describes the characteristics of farm production, the outcomes from land uses and the joint-production, focusing on these relationships

b) The normative domain or policy-oriented concept (FAO and EU):

It is considered as a policy instrument of rural development

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Two approaches to the analysis of Multifunctionality:

MF as a characteristic of economic activity - the particular characteristic that makes an economic activity multifunctional are its multiple, interconnected outputs or effects MF interpreted in this way is not specific to agriculture This view can be termed the positive concept of MF

MF in terms of multiple roles assigned to agriculture Agriculture as an activity is entrusted with fulfilling

certain functions in society MF is not merely a characteristic of the production

process, it takes on a value in itself This view can be termed the normative concept of MF

10POSITIVISTIC/ACTIVITY

ORIENTED/ANALYTICAL CONCEPT: OECD

Multifunctionality, or multifunctional agriculture are terms used to indicate generally that agriculture can produce various non-commodity outputs in addition to food

The working definition of multifunctionality used by the OECD associates multifunctionality with particular characteristics of the agricultural production process and its outputs:

the existence of multiple commodity and non-commodity outputs that are jointly produced by agriculture

that some of the non-commodity outputs may exhibit the characteristics of externalities or public goods, such that markets for these goods function poorly or are non-existent

OECD, 2001

11THE NATURE OF JOINTNESS

IN AGRICULTURE Joint production refers to the situation where a firm

produces two or more outputs that are interlinked, so that an increase or decrease of supply of one output affects the levels of the others

Three reasons for jointness can be distinguished:

Technical interdependencies in the production process

Non – allocable inputs

Allocable inputs that are fixed at the firm level

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THE NATURE OF JOINTNESS IN AGRICULTURE –

TECHNICAL INTERDEPENDENCIES

Many of the negative non-commodity outputs of agriculture, as of: Soil erosion Chemical residuals Nutrient leaching Greenhouse gas emissions Problems of animal welfare

Positive non-commodity outputs: Pest controlling effects of certain cropping patterns

used in integrated pest management Crop rotation effect on soil productivity and nutrient

balances

13THE NATURE OF JOINTNESS IN

AGRICULTURE – NON- ALLOCABLE INPUTS

Non allocable inputs = multiple outputs from the same input

Eggs, poultry meat, feather

Mutton, wool, milk

Production of meat and manure

Terraced paddy fields

Alpine pastures with cows

These joint outputs are rarely produced in fixed proportions and those proportions can be modified by using different production methods

Many output linkages can be attributed either to technical or to non-allocable inputs (like food and landscape )

14THE NATURE OF JOINTNESS IN

AGRICULTURE –ALLOCABLE INPUTS

Allocable inputs are available at firm level in a fixed amount and are allocated to the various outputs in the production process

An increase/decrease in the production of one output changes the amount of the factor available for the supply of the others

Farmland and self-employed labour are allocable factors

15SUSTAINABLE

DEVELOPMENT The most frequently quoted definition is from Our

Common Future, also known as the Brundtland Report:

"Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs. It contains within it two key concepts:

the concept of needs, in particular the essential needs of the world's poor, to which overriding priority should be given; and

the idea of limitations imposed by the state of technology and social organization on the environment's ability to meet present and future needs.“

16SUSTAINABLE

DEVELOPMENT Meeting the needs of the future depends on how well

we balance social, economic, and environmental objectives--or needs--when making decisions today

Environment

Soci

al

Economic

ServicesHousehold NeedsIndustrial GrowthAgricultural GrowthEfficient use of Labor

BiodiversityNatural ResourcesEcosystem IntegrityClean Air and Water

EquityParticipationSocial MobilityCultural Preservation

17ECONOMIC

SUSTAINABILITY Economic policies typically seek to increase

conventional gross national product (GNP), and induce more efficient production and consumption of (mainly marketed) goods and services

The modern concept underlying economic sustainability seeks to maximize the flow of income that could be generated while at least maintaining the stock of assets (or capital ) which yield this income

18SOCIAL

SUSTAINABILITY Reducing vulnerability and maintaining the health

(i.e., resilience, vigor and organization) of social and cultural systems, and their ability to withstand shocks

Enhancing human capital (through education) and strengthening social values, institutions and equity will improve the resilience of social systems and governance

19ENVIRONMENTAL SUSTAINABILITY Modern economies have only recently acknowledged

the need to manage scarce natural resources in a prudent manner – because human welfare ultimately depends on ecological services

The environmental interpretation of sustainability focuses on the overall viability and health of living systems – defined in terms of a comprehensive, multi-scale, dynamic, hierarchical measure of resilience, vigor and organization

20SUSTAINABLE RURAL

DEVELOPMENT"Sustainable development is the management and

conservation of the natural resources base, and the orientation of technological and institutional change in such a manner as to ensure the attainment and continued satisfaction of human needs for present and future generations.

Such sustainable development in the agriculture, forestry and fisheries sectors conserves land, water, plant and animal genetic resources, is environmentally non-degrading, technically appropriate, economically viable and socially acceptable."

(FAO, 1988)

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Scheme of sustainable development: at the confluence of three constituent parts

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Multifunctional agriculture & Sustainable Development

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25EUROPE 2020: MFA AND

SD Sustainable growth Initiative - for a resource

efficient, greener and more competitive economy

Rural Development Policy – 3 axes improving the competitiveness of the agricultural and

forestry sector; improving the environment and the countryside; improving the quality of life in rural areas and

encouraging diversification of the rural economy

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Example :

Chain of policy implementation: Fund CAP / Programme Rural Development / Priority axis XXX / measure  XXX  / local development strategy/ projet- operation

Within a specific area (local area), how many farmers, what type of farms and where will be impacted by project - operation (s) implementation? Knowing that farmers act within a local context where the behavior of other actors (consumers, Ngos, … will have an influence on their choices. Consequently , necessity to know and modelize actor behaviors. This will be done at the scale of implementation of project or operation ( local scale) but with necessity to aggregate population dynamics at regional level; remenber that we are supposed to check results with those obtained with aggregated models.

In a second step we will have to measure the impact of population dynamics on the different functions provided by the sector. By this way we can assess the impact in terms of multifunctionality and implement or improve SIAT and other databases.

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Employment function

Economy

Environment

Society

Production function

Food

Services… Cultural function

Ecosystem function

CAP/ European Agricultural Fund for Rural Development/Priorities/

Agriculture

Forestry

Tourism

Biodiversity

Impacts on

Local level

European level

National levelProgrammes

Measures

Operation /projectsRegional level

Spatial function

Protection function

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THANK YOU FOR YOUR ATTENTION!

Associate Professor Dr. Diana KopevaDepartment “Economics of Natural Resources”Business facultyUniversity of National and World EconomySofiadiana_kopeva@yahoo.comdkopeva@unwe.acad.bg