Quantitative Research in Agricultural Economics: The Interdependence between Agriculture and the National Economy

Abstract

R ECENT trends in quantitative research in economics have led away from the more superficial analysis of market barometers (for example, share prices and wholesale prices) towards those more basic economic factors that are the end results of economic activity, such as volume of output, consumption, investment, and real income in the various sectors of the economy. This change in objectives has brought with it a change in the necessary theoretical framework and statistical tools. The emphasis has shifted from mechanical investigations of the ups and downs of certain descriptive time series to the development of theoretical models intended to explain, quantitatively, the mutual interdependence among the various economic factors. The purpose of studying such interrelations is to obtain an explanation of the mechanism that determines the level of economic activity and thereby the general economic welfare of the various groups in the economy. This same purpose is equally appropriate and desirable for modern economic research concerning the agricultural sector of the economy.t