Impacts of Technology and Structural Change on Agricultural Economy, Rural Communities, and the Environment

Abstract

Recent advances in biotechnology and information technology could revolutionalize U.S. agriculture. Through embryo transfers, gene insertion, growth hormones, and other genetic engineering techniques, cattle, swine, sheep, and poultry in the year 2000 would produce more meat per pound of feed, dairy cows would produce more milk per cow, major crops would be genetically altered to resist insects and diseases and to produce their own fertilizers and herbicides, and computers and electronics would be widely used on farms to increase management efficiency. These are only a few of more than 150 emerging technologies in 28 areas forecasted in an ongoing study by the Office of Technology Assessment (OTA). These areas of technologies range from plant and animal genetic engineering, plant growth regulators, and animal reproduction, to monitoring and controlling technology and telecommunication. Many of these technologies, such as growth hormones, monoclonal antibodies, super ovulation, embryo transfers, and slow-release insecticides are already in the marketplace, while others are still in the laboratory. When these technologies are adopted by farmers and put into the agricultural production system, they could alter drastically the structure of U.S. agriculture, which has been evolving toward a dual structure, where a few large and very large farms produce most of the total output and capture the majority of net farm income while very many small subsistence and part-time farms produce a small portion of the total'output and receive a very small share of net farm income. (For a more detailed discussion of the movement toward a dual structure, see chap. 4 of the OTA report.) Commercialization of new technologies would further stimulate expansion of farm size and accelerate resource concentration in agriculture for two reasons: (a) the biasness of technology adoption and (b) the downward slope of the average cost curve. Although most of the new technologies are scale neutral, i.e., they are equally applicable to large as well as small farms, their adoption tends to favor large farms. Typically, new technologies are first adopted by large farms because these farms have more access to information and