It is now two months since I wrote my latest
article about small farms, where I promised to write another one on labor
productivity and its implications for the space of consumption for small holder
farmers and its capacity to generate surplus labor for other societal purposes.
The main reason for the silence is the writing of a
forthcoming book about the evolution of the trinity cattle, grass and
humans. The manuscript is now sent to the publisher, Ordfront, and the book (in Swedish) will
be launched in May.
 |
| The author in early days with primitive tools |
Admittedly, another reason is that the subject is difficult.
It is not a trivial thing to do to define options for productivity of
smallholder farming and there are many issues to consider. And the interaction
between a smallholder economy and the economy at large is also not straight
forward. Do we talk globally or locally?
And why bother anyway? Isn’t smallholder farming doomed as
the previous posts have demonstrated? Is it desirable? Do people really want to
be peasants?
I have written about these issues many times and there are
many reasons for me to conclude that the current civilization is not
sustainable and that commodity farming drives destruction of the environment
and, ultimately, also destroy farm communities and rural areas. I will not
repeat those arguments here, you will just have to take them at face value. In
my view, society is bound to move towards simplification and less use of
external resources. Will people revert to farming as a result of those external
factors as they done many times before, after the collapse of the Soviet Union,
or during the financial crisis in Greece or Spain?
One can be a small-holder farmer and use very modern
technology and have high labor productivity. When I farmed in the county of
Värmland, not so far from Norway, we were all envious of Norwegian farmers with
10-20 hectares because they had more and better machinery than their Swedish
counterparts with 60-100 hectares. This
was a result of the very farmer-friendly Norwegian agriculture policies. But, on
the flop side, by and large, it is not sustainable or realistic to have
hyper-mechanized small farms. The resource use per person and per unit produced
on highly mechanized small farms is, by and large, not justifiable. Unless
there are special policies favoring small farms, competition and economy of
scale will still favor the bigger. Another version of small scale farmers are
those, like myself, who buy used machinery of their more industrious colleagues.
It is only because they buy new and bigger equipment that I can have a tractor (well
I even got two!), a grass mower, a rotavator, a manure spreader and many other
mechanical tools. Our production would never carry such investments if those
were new.
Remember that I discuss labor productivity. It is well
established that productivity of land or productivity of other employed
resources on small farms can be high and higher than on big farms. But, by and
large, labor productivity is so important for farm economy that it makes very
little difference if your yield is ten percent higher if your labor
productivity is low. Compared to pre-industrial times, yield of grain per
hectare has increased perhaps five times and a cow gives six, seven times more
milk. But, more importantly, the work time spent to produce one ton of wheat has
gone from a few hundred hours to a less than 10 minutes according to Swedish data.
One person on a large scale corn farm in the US can manage some 400 hectares of
land, while a small scale farmer in Africa manage only a thousandths of that area.
In addition, as the yield per area unit is five times higher the labor
productivity of such an ultra-mechanized farmer is five thousand times higher than a totally manual farmer.
Clearly energy play an enormous role in this. Most of the
increase in productivity is a result of technical applications of energy in the
form of fossil fuels. Some applications were, and are, also possible with other
fuel sources. Wood-fueled steam engines were used in an early stage for
stationary threshers, and tractors could also be driven with gasified wood (I
once bought a WWII wood gas set for my old Ferguson tractor, but never came
around to install it). But by and large, oil has been the main energy source
for the raise in labor productivity. In Chris Smaje’s grass-mowing
experiment the Middle Ages actually win the productivity race if
productivity is measured in energy units instead of man hours.
In the current economy the enormous productivity of large
scale farming using humongous quantities of fossil fuels both for machinery and
fertilizers has depressed agriculture prices to levels where it is totally
unrealistic to survive as a small scale farmer producing mainstream foods.
Clearly, some farms are still profitable despite being small, but they don’t
compete in commodity markets for staple food but have totally different kinds
of production. This can be a successful strategy for a few farms, but has
nothing to do with my discussion about an agrarian economy dominated by small
scale farms.
Is there any sweet spot between the 10,000 hectare or 2,500
cow farm and the manual toil where one can combine some measure of
mechanization with a level of labor productivity which is sufficient for maintaining
an industrial structure to mass produce those tools needed for that? Is that
sweet spot in the Middle Ages, in the 1890s, in the 1930s or in the 2050s?
Currently there are expectations that new robotics and artificial
intelligence will be a boon for small scale farms and allow them to have as
high labor productivity as large farms. I will not totally rule out that it might happen, but so far I am not at all
convinced. Even if those robots materialize it is not clear to me how that will
work out taking agriculture markets into account. Ultimately, it is the relative
competitiveness of small versus big that matters, not if robots can ease work
for small farmers. There has been many similar wishful claims earlier of how
new technology would make small guys more competitive (remember the internet?).
Anyhow, that is a separate discussion.
Will there be washing
machines – and will smallholders afford them?
The bigger question is also how much surplus labor and
resources can be allocated to other things than food production and the tools
necessary for it. Already in medieval times farming generated surpluses which
were used to erect magnificent cathedrals and castles and support arts and
other acts of culture as well as devastating and endless wars. The life of a
peasant was often grim and a failed harvest or illness could mean starvation or
transfer to various forms of servitude (at least this is how the story goes).
Some of this was caused by the huge inequality in societies and lack of access
to resources rather than by low labor productivity.
Let us assume a fair peasant based society where the
peasants are free and not under the pressure of church, king and lords. Can
there be hospitals, will there be antibiotics, hot water and electricity? Or, as
expressed by Hans Rosling, will people be above the “wash line”, i.e. will they
have access to a washing machine? In 2010 when he made his TED
talk about the magic washing machine he calculated that around 2 billion of
the world´s population could wash their clothes in a washing machine. The
others had to wash by hand.
In 2010 the magic wash line represented a daily income of US$40
US dollars per day. While only 2 billion people had such an income, at the same
time the average global income was actually almost on that line. It crossed it
2013. Hans Rosling didn’t comment upon that, apparently more interested in the
narrative of development than the narrative of equality and fairness.
Let´s compare the Rosling wash line (14 000 US dollars
GDP per person) with the proportion of people working in agriculture. In 2018
the average income in the group of middle income countries were just below the
line. Countries close to the line are Colombia, Peru, Bosnia and Herzegovina,
Mongolia, South Africa, Paraguay and Sri Lanka. United States passed it during
WW II 1942, Sweden 1959, England 1963, , Japan 1969, China passed the line in
2015. When countries passed the wash line they had the following share of the
work force employed in agriculture:
Year crossing the wash line
|
Percent of work force in agriculture
|
Share of agriculture of GDP
|
|
United States
|
1942
|
13%
|
9%
|
Sweden
|
1959
|
14%
|
7%
|
United Kingdom
|
1963
|
4%
|
4%
|
Japan
|
1969
|
19%
|
7%
|
China
|
2015
|
29%
|
8%
|
Colombia
|
2018
|
16%
|
6%
|
Data
sources: World Bank and Our world in data
|
|||
Some of the countries were food exporters and others
importers, I guess the UK imported a lot of food at the time the crossed the
line, while the US was a large exporter. By and large a situation where between
10 and 20 percent of the population is engaged in farming seems to be conducive
to a situation where people can have washing machines, there are hospitals,
trains, universities and most of the things we associate with modernity.
Sweden passed the wash line 1959, two years after I was born.
The combined power of fossil fuel and competition had not, as yet, totally
transformed the agriculture system. In addition, until 1949 Sweden had a
small-farmer friendly agriculture policy. With increasing demand of labor for
the factories and a linked “need” for cheaper food those policies were
abolished.
How did an average Swedish farm look like at that time? It
had 13 hectares of arable land and 2 hectares of pastures and permanent
grasslands (abandonment of grasslands started much earlier). There were
148 000 tractors (coincidentally more or less the same number as today!)
and 26 000 combine harvesters on a total of 230 000 farms. Horses
were still in rather frequent use as the number of work horses were the same as
the number of tractors. 190 000 of the farms had cattle, almost all of
them were dairy cattle. Today, there are just 3,500 dairy farms left with an
average of 100 milking cows. More than 100 000 farms raised pigs and most
of the farms had a few laying hens.
While Sweden could be seen as a small farm haven 1959, it
had already entered the fossil fuel era, especially with the use of fertilizers
(which by and large are fossil fuels in disguise), which was even bigger than
today. So Swedish farming or society was in no way sustainable 1959 as little
as China is that today.
One can of course argue that agriculture had at that stage
already shrunk so much that its importance for the general development in the
country was small. If you study the table it seems that the agriculture share
of GDP has a stronger linkage to the wash line than the share of the population
employed in agriculture. I guess this means that people’s access to washing
machinery is a result of industrialization rather than agriculture
productivity. Washing machines are after all industrial products. As the
example of China show, people can have washing machines despite a rather low
labor productivity in the farm sector. My guess is that most Chinese farmers
can’t afford a washing machine even today, while most Swedish farmers probably
bought one in the 1960s.
Perhaps, we need to go back further to find the sweet spot. Recent research shows
that Vietnam is the country that best has managed to balance social development
and welfare within planetary boundaries. It only transgress one biophysical
boundary while achieving six out of eleven social development indicators
(similar to Italy, Chile and Greece which transgress five, six and seven
biophysical boundaries). Vietnam has 41 percent of its workforce in agriculture
and agriculture makes up 14 percent of the GDP of US$7,400, i.e. half of the
wash line. Almost everybody has electricity and most have access to clean
water. Vietnam has radically reduced poverty and is also a fairly equal society
with a Gini coefficient around 0.35. Women also have a strong standing in
Vietnamese society.
I am not sure of this detour to macro-economics made me or
the readers any wiser?
*
Sooner (preferably) or later societies and farming will have
to adjust to a renewable energy economy. None of the renewable energy sources
will be as efficient as oil and, therefore, the level of mechanization, and
labor productivity might be “lower” in an inevitable non-fossil future. But the
drive for more mechanization, more specialization and bigger units will most
likely be the same in a market economy. Well, it could even be stronger as some
alternative fuels would favor bigger units. For example, while very small scale
biogas digesters are a realistic alternative for gas for cooking for millions
of small farms in China, farm scale biogas production for tractor fuel assume
very big farm units.
By and large, it is impossible to disentangle agriculture
from society at large and as long as farming is mainly operating as a producer
of commodities it will inevitably follow the logic of industrialization with
ever increasing labor productivity, be it driven by fossil fuel, solar energy
produced hydrogen or wood gas. If farming is seen as something else, as
planetary stewardship, maintenance of ecosystem or cultural services or as a
lifestyle then the logic of labor productivity plays out differently, which is
clearly visible even in our oil-soaked universe.
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