Perspective on life in Germany

I went to a conference in Brussels organized by my friend Justus Wesseler. He wanted to introduce me to his roots in Germany, so we traveled to his mother’s house near Munster, which is 300Km from Brussels. It may take 2.5 hours as there is no speed limit on the German Autobahn and some drive 130mph. Justus drives slowly, only 80 MPH, and indeed the road to Munster took only about 3 hours. The way back took twice as long as – traffic jams.

Munster Church

I was surprised that many of the vehicles were small French and Italian cars. Justus explained that parking in the city is tougher for larger cars. They also require higher taxes and fuel costs, so the Germans joke that Mercedes are produced by Germans for the U.S. and China.

Munster and the cities around it are beautiful. Munster was ranked recently as the most livable city in the world.  People ride bicycles all over, and there are many parks and memorials. It became famous for the Treaty of Westphalia, which ended the 30 Years’ War (a conflict between Catholics and Protestants from 1618 to 1648). I visited the beautiful room in which this peace treaty was signed. (photo of the building and the room are below). The treaty recognized the principle of separation church from state and established co-existence between Catholics and Protestants. Before the war the fundamental Protestants behaved much like ISIS and established a reign of terror (beheadings, etc) but then were defeated and hanged. Nothing new under the sun.

Westphalia Treaty room

Today the city and the area around it are magnets to the old (supposedly to the young too – but I did not see them). I reduced the average age by a lot.  We visited Justus’ mom,   Elfride,  who lives in exquisitely neat and clean  converted farm house, with a piano and  beautifully arranged  arts, flowers and furniture. Only a few of the people in the village are full time farmers. The others started middle size firms or are professionals and their old barns and animal sheds have been transformed to charming  residence.  

Elfride  is a young 78 who is still running after deer who eat her vegetables (and curses them- her late husband hunted them as you can see below). She reminded me of Hana, my late mother in law. She is a Duracell lady, who blamed me for electing Trump and cursed him, and baked a wonderful strawberry cake. She spends half her time in her perfect garden making sure that falling leaves are instantly removed. According to Justus the she also sends letters to politicians – demanding cleaner safer and more humane municipality.

A therapeutic wall

I stayed in a Hotel Dreyer Garni,   in a nearby resort town, Bad Rothenfelde. The city has unique  mineral water that are pumped and released down a long ( 350 meters)   and tall (15 meters) wall. On the way down they are slowed  by  plants and release oxygen and other gases that improve breathing (see the wall below).  I  went around the wall, and met  there many other seniors ( some were  pumping weights or exercising)  and the fresh air kept me awake. I also enjoyed the flowers and monuments in the  area.  I  saw at least three memorials  to the soldiers who fell in the first world war- but not to those who died in the second one. I spoke with several Germans and they have a sense of shame and guilt about the war- and  for democratically choosing Adolph ( actually someone said to me- “democratic rule does not assures good choices”). People also spoke  with me about Israel, and showed admiration to Israel’s success ( Justus showed me an article in the local paper “what Germany can learn from Israel”, relating to water conservation). Yet speaking with younger Germans  I found that supporting Israel is becoming more clouded in light of Israel’s treatment of Palestinians.

Despite the Hitler stain, Germans are quite proud of their heritage- and the great scientists, musician  and scholars they  produced. They believe that Göttingen university,   is at least as great as  Oxford, Cambridge or Padua (where Galileo’s s taught and Copernicus studied) and  new comers like Harvard and Berkeley. Indeed  their mathematics team with Gauss, Riemann and Hibert  and von neumann is tops, they have Heine, the Brothers Grimm and Schopenhauer  in the humanities. Two of the greatest physicists of the University of California, Oppenheimer and Teller also studies there.

Unlike my last visit to Italy where wearing a Warriors T-shirt led to many high fives (especially after winning a title), here almost no one was aware or seemed to care about the NBA (some heard about Nowitzki). But unlike Italy, soccer is the only game in town. In Germany, people may play basketball and other sports but their regional pride and identity is expressed by their soccer team. But sport is not everything. The Germans I met are part of team Europe and want the EU to succeed. They see it as the best way to express their unique capability, protect them from their worst tendencies, and form a power to counter the giants (Russia, China, and now perhaps the US). While the Chinese and Russians were always suspect, the Germans and other Europeans viewed the US as a naïve (maybe idealistic) and friendly giant –  but now with Trump, the naivete stays but the friendliness is gone.

I am on my way from Washington now. I enjoy these trips – need to take them more – but I also miss home. I’ll be on the road quite a bit this summer for several conferences and consulting assignments, with most of July dedicated to the Beahrs’ Environmental Leadership Program.

Agriculture as Economic Development

https://www.thechicagocouncil.org/blog/global-food-thought/guest-commentary-agriculture-economic-development

Editor’s Note: As part of our new blog series, The Next Generation, the Chicago Council on Global Affairs is inviting a diverse group of experts to explore topics related to youth employement and agriculture in advance of  the 2018 Global Food and Security Symposium.  Join the discussion using #GlobalAg, and tune in to the symposium live stream on March 21 and 22.
 
By Dr. David Zilberman
 
The emergence of agriculture marked the beginning of human civilization as we know it. For millennia, agriculture employed most of humanity, as there was a very low rate of technological change. But since the 19th century, society went through a science-based revolution introducing mechanical, chemical, and biological innovation, increasing the amount of food grown per farmer, and allowing humanity to shift to industrial activities, with the rapid expansion of urban areas. Agriculture has provided the feedstock for the earliest industries, which processed and preserved food, and provided fiber. Through fermentation humans were able to preserve food and produce alcohol, and through various processes produce other food products that enhanced health, and improved quality of life. 
 
The progress of agriculture in the US and around the world wouldn’t have been possible without the establishment of supportive infrastructure and policy. This includes the land grant colleges, agricultural experiment stations, and cooperative extension that discovered new knowledge, developed cutting edge technologies, and built the capacity of farmers to utilize the technologies. More recently, we have seen the emergence of the educational-industrial complex, where the results of university research are developed by industry and result in new products that increase the productivity of farmers, improve product and food safety, and enhance environmental conditions and quality of life of consumers. The implementation of agricultural innovation benefited from an environment of increasingly open international trade and required innovative development of supply chains. Agribusiness executives have been challenged to design supply chains to implement innovations taking account of economies of scale, differences in capacity across locations, and they continue to adapt their supply chain and business models, as technology and economic conditions evolve.
 

Agriculture is Vital in the Modern Age

In the current age, agriculture employs fewer people, but remains a crucial source of raw materials that are necessary for the large agrifood sector that is so paramount for quality of life. The discovery of DNA and new developments in information and nanotechnology provide the foundation for a new agricultural revolution that will enhance productivity and reduce, or even eliminate, some of the negative side effects of agricultural production. Furthermore, they provide the foundation for a new bioeconomy that will expand the range of products derived from agricultural and natural resource sectors to provide feedstock for fuel, fiber, and fine chemicals. A major challenge of our generation is to move to a sustainable system and to mitigate emissions and adapt to climate change. The new bioeconomy can provide the tools to help meet these challenges by revolutionizing the agrifood sector, moving towards a renewable economy while replacing our dependence on non-renewables like fossil fuels with new renewable feedstocks. The notion of sustainable development that would allow improvement of human welfare globally, while sustaining and improving environmental quality of our planet depends on a progressive and advanced agrifood sector and an effective and efficient bioeconomy.
 
However, the gap between high income and lower income regions persists. Many developing countries are facing the challenge of eliminating poverty and improving the quality of life, and much of it can be done via the modernization of agriculture. Yield per unit of land is much higher in the developed countries. Europe and the United States, for example, are producing five to ten times more corn per unit of land than low- and middle-income countries. Even doubling or tripling the yield in these regions will allow the elimination of malnourishment, may reduce the footprint of agriculture, and reduce deforestation. Development of agriculture and agribusiness is key strategy for development. Agricultural transformation will provide the foundation for societal development in general, as it will lead to an expanded agrifood sector that provide consumers with nutritious, convenient, flavorful, and quality food. It will provide more jobs in rural areas, enhancing quality of life in these areas and reducing the need for farmers to move to urban areas in search of livelihoods.
 

Building Transformative Economies

However, transformation of agriculture in many developing countries is constrained by limited human capital, lack of investment in research and education, regulation that impedes adoption of innovation, and restrictions on trade. Investment by governments and donors has already improved educational obtainment globally and established networks of international and national agricultural research organizations. Despite this progress, much needs to be done. Modernization of agriculture requires investing in and expanding educational systems to improve the capabilities of consumers and farmers. There is a growing commitment to significant and sustainable investment in research, extension, technology transfer, and expansion of the model of educational-industrial complex around the world. While developing regions are likely to be the major beneficiary of new discoveries with agricultural biotechnology, they haven’t gained much from this new capability because of restrictive regulations. Science-based regulations that balance benefits with risks will lead to adoption of and development of new agricultural capabilities and allow developing countries to better address their resource challenges.
 
There is a need to develop economic systems that are transparent, with minimal barriers to trade and low transaction costs, and to develop an environment that encourages individuals to be entrepreneurial and innovate new businesses and supply chains that will lead to the build-up of the bioeconomy. There is growing evidence of the entrepreneurial capacity of the agrifood sector in developing regions, and the gains from evolving supply chains, especially in exporting flowers (in Kenya) and creating new aquaculture systems (in Bangladesh and Myanmar). But these emergent examples should be expanded and the scientific, educational and financial capabilities need to be expanded to allow for further development of similar systems and expansion of the bioeconomy to new activities in developing countries.
 
Practitioners in industry, policymakers in government, and activists in NGOs must be aware of the changing agrifood sector, the great potential of modern agriculture as an engine for growth, and how to take advantage of it. Importantly, these groups need to work together to create an agrifood sector that works for all.
 

Supply Chain Innovation

Facilitating conversation and shared understanding around these priorities is the goal of the agrifood supply chains workshop that we are now organizing for the third year. This year’s workshop theme is “Innovations in Agrifood Supply Chains: People-Planet-Profitability”. We decided to focus on the interconnected area of people, which includes consumers and producers, planet, which is of course our environment, and profit, which still has to be the main matrix of any successful business. We realized that the global food and agriculture industry is having to deal with not only the resource related issues, such as water and energy, but also consumers’ growing desire to be more responsible with their purchasing decision and demanding more from the producers and manufactures to be more ethical than ever. At the same time, businesses will still have to continue to maximize their profit. We are hoping to shed light on practices that supports all three in our workshop this year.
 
What makes this program unique is the collaboration with Solidaridad Network and the interests of other academic institutions. Solidaridad is an international non-profit organization with over 45 years of experience and it is unique in its understanding of the importance of business and building business relationships and supply chains spanning developed and developing countries.
 
We collaborate with other academic institutions, such as UC Davis, Michigan State, and Guelph, and we have been partnering with Mars and have strong relationships with Costco and Bank of America. We are also participating in workshops in Peru and Germany, and are the nexus of an emerging global consortium.
 
With an increasing world population, with the need for food growing unabated, natural resources under pressure and the need for food that is healthy and responsibly produced, the agrifood industry has to transform, from the focus solely on making profits to aiming to achieve other goals that were traditionally advocated by non-profits in the past. This is a paradigm shift that the agrifood industry is having to embrace, along with recognizing their role as partners in sustainable development as well.
 

Take-Home Exam

DevP 233

Take-Home Exam

Spring 2017

David Zilberman

 

  1. Explain the following terms and their significance:
    1. Median Voter Theorem
    2. Arrow’s Impossibility Theorem
    3. Rent seeking behavior
    4. Regulatory capture
    5. PEST vs. PERT transfers
    6. Risk aversion, risk neutrality vs. loss aversion
    7. Prospect theory
    8. Bayesian learning
    9. Asymmetric information
    10. Principal-agent problem
  2. Explain the behavior of a politician (or regulator) as an economic agent, and what considerations are used in deciding policies that may result in socially suboptimal outcomes. Give one or two examples.
  3. Write a short essay explaining how economic and political factors help in shaping market outcomes.
  4. Write a short essay explaining the differences in agricultural policies in developed and developing countries, including factors that affect the evolution of agricultural policies. Analyze briefly the evolution of agricultural policies in a country, region, or crop of your choice.

 

Good luck.