Nobel economist Vernon Smith, who received the prize in 2002 for his work in experimental economics and auction markets, delivered a talk on the economics and politics of globalization at NC State University last week. One of several important themes of Smith’s presentation was the idea that technology and exchange will make it possible to feed a growing world population. Science has already made it possible to get higher yields from food crops through plant biotechnology—genetic engineering. Although it won’t literally be possible to grow the world’s food supply in a flowerpot, reducing hunger and nutritional deficiencies are real possibilities with genetically modified food plants.
At some point in their principles training, Economics students are faced with the intriguing question of why you can’t grow the world’s food supply in a flowerpot. The reason is that the “productivity”—marginal product—of additional seeds gets smaller and smaller, given the fixed-size pot. Crowding, and competition for water and nutrients takes its toll in the microcosm of the flowerpot.
In the face of a growing world population, food crop producers face a similar problem. If land area under cultivation could easily be expanded, or soil didn’t lose its ability to support growth, population changes would present less of a challenge. But land area under cultivation cannot always be expanded, soils experience depletion, and insect and plant pests decrease yields of food crops. Changing or adding “flower pots” isn’t an option. To support health and well being, the available acreage must produce more and better foodstuffs. In both developed and underdeveloped nations, genetically modified (GM) seeds are being used to produce more, and more nutritious food crops, within the available acreage. The increasing use of GM crops illustrates how well markets respond to scarcity, and to change.
With genetically modified crops, the plants themselves are engineered for higher yields. Some seeds are genetically altered to make them resistant to insects or bacteria. One modification allows growers to apply weed control chemicals that do not kill the food plants. For the first time ever for some of the world’s populations, it may be possible to rise above living at bare subsistence levels. These are some of the implications of Vernon Smith’s globalization lecture. As technology and products cross borders, prosperity and peace follow.
Altering plant genetics differs from the selective breeding techniques of the past, which often took many generations to produce results. But not everyone is happy with the genetically modified products. Natural food advocates and environmental groups like Greenpeace have raised alarms about potential harms to consumers, even though pesticide usage is greatly reduced for some crops. As yet, however, there is no scientific evidence that engineered disease or pesticide resistance in plants, or other genetic modifications, causes health problems in humans or the environment.
Increases in available food nutrients like lycopene in genetically modified tomatoes, beta carotene in “golden rice,” increases in nutritional iron and a reduction in toxic cadmium in GM plants, drought-resistance and other factors are being genetically engineered into food plants. These increase the quality and quantity of the world’s food supply. Genetically modified soybeans, perhaps the most significant world food crop, will comprise 80 percent of U.S. cultivation this year, and the percentages are increasing annually in other countries. Cotton yields in China, using borer-resistant plants, are increasing production and allowing cotton revenues to rise for Chinese farmers. Spain and China are growing pest-proof “super maize”. “Golden rice, “green rice,” and borer-proof rice are being tested or are under cultivation in countries in which rice is a staple food.
Smith emphasized that change, globalization and trade are not new ideas; they have been with us for millennia. He also expressed confidence that changing technology, and markets, would meet the challenge of feeding more people worldwide.
Change is happening, and it has always been with us. It’s not a question of whether we accept it or can even stop it if we want to, but how well we deal with transitions that makes the process easier or more difficult. (Vernon Smith, 2005).