The Competitiveness of Organic Agriculture – an Analysis with the Concept of Path Dependence

UWE LATACZ-LOHMANN, GUIDO RECKE, HENDRIK WOLFF

Published: 12.11.2001  〉 Heft 7 (von 8) / 2001  〉 Resort: Articles 
Submitted: N. A.   〉 Feedback to authors after first review: N. A.   〉 Accepted: N. A.

ABSTRACT

This paper invokes the concept of path dependence to gain new conceptual insights into the competition between conventional and organic agriculture. We develop a simple model of path dependent agricultural technologies to demonstrate how random events at the beginning of the development path of a technology, combined with increasing returns to adoption, can give rise to an early lock-in of an inferior production system. We conclude that, depending on the circumstances, there may be a place for policy intervention to break the dominance of locked-in agricultural technologies. Any such policy should aim at enhancing network externalities within the organic sector and contribute to the development of the long-term technological potential of organic agriculture.
CONTACT AUTHOR
Dr. UWE LATACZ-LOHMANN, Department of Land Economy, University of Cambridge, 19 Silver Street, Cambridge CB4 2HD, England. LATACZ-LOHMANN ist ebenfalls Adjunct Lecturer in Agricultural and Resource Economics, Faculty of Agriculture, University of Western Australia, Crawley, Perth, WA 6009, Australia.
Dr. GUIDO RECKE, Institut für Agrarökonomie der Universität Göttingen, Platz der Göttinger Sieben 5, D-37073 Göttingen.
Dipl.-Ing. agr. HENDRIK WOLFF, Institut für Agrarpolitik, Marktforschung und Wirtschaftssoziologie der Universität Bonn, Nussallee 21, D-53115 Bonn.
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