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Poor credit has been blamed for some of the overall reduction in farm output

One of the main differences between Russia and Ukraine where productivity fell and some of the CEECs, such as Hungary and the Czech Republic, where productivity increased strongly, is not so much the scale of the farm operations, but rather the degree to which their management structure was restructured. In the CEECs, farm enterprise budgets were hardened and on-farm decision making became independent and primarily concerned with turning a profit. Restructuring induced sharp shifts in input use, effective management reforms, and efficiency increases . In contrast, farm restructuring in Russia and in several other FSU countries has been mostly superficial. For example, while the outside imposition of production plans is officially abolished, local authorities continue to influence farm management through informal relationships . The inability to restructure farms has caused a decline of farm efficiency . Differences in restructuring are linked to land reform. In many CEECs land was either restituted to former owners, distributed to farm workers in delineated boundaries, or leased to new farms. Although the land reforms in these countries were complex and difficult to implement, they ended up with stronger and better defined property rights for the new landowners than most of the FSU countries. In the FSU countries, in contrast, land was distributed as paper shares or certificates to workers of the collectives and state farms. Individuals can not identify the piece of land that belongs to any given share, causing weak land rights for individuals and undermining their ability to withdraw land from the large farms. As a result, family farming is emerging only slowly,led grow lights and large farms have little incentive to restructure .Hence, there have been significant differences in the approaches of countries to land reform and the creation of property rights in rural areas.

Good rights and the incentives they created certainly were behind positive performance . Poor ones undoubtedly contributed to the poor performance and will continue to adversely affect future performance. All transitional countries also experienced some form of price and subsidy policy reforms. In China, leaders administratively increased agricultural output prices following decollectivization. The rise in prices in the late 1970s and early 1980s partly explains the increase in farm profits during this period, as it did in Vietnam a few years later . Price reform was much bolder outside of Asia. In most CEECs, leaders dismantled planning system by decontrolling agricultural prices and dramatically reducing subsidies in the early 1990s . In Russia, reformers also liberalized prices in the early reforms, although substantial subsidies to agriculture have continued. Unlike in the case of Asia, however, reforms did not lead to a large price increase and stimulate production. Falling incomes put downward pressure on domestic prices. In many countries the combination of the fall in the real price of output and the rise in the real price of inputs led to a crisis for the agricultural sector . Changes to the trading regime occurred at the same time and were equally decisive in all but the Asian economies. The collapse of the CMEA trading system led to trade disruptions in many countries, especially in those where CMEA trade integration was strongest. Access to some inputs was disrupted. The shift to hard currency payments for imports and falls in income led to a reduction in the demand for foreign agro-food products. In contrast, the early trade reforms saw only limited changes in China . Vietnam also slowly liberalized trade, but rice, one of the nation’s most important post-reform export products received special treatment by leaders. Disruptions in the agri-food chain compounded the agricultural crises in the countries of the FSU and the CEECs .

Pre-transition systems were strongly vertically integrated. The central planner directed both sides of transactions and enforced contracts involving exchanges between the various agents in the chain. The reforms removed state control over planning and resource allocation . In conjunction with reform in the rest of the economy, the strategy in agriculture involved rapid privatization and restructuring of upand down-stream enterprises. However the removal of the central planning and control system, in the absence of new institutions to enforce contracts, distribute information, and finance intermediation caused serious disruptions and negatively affected output throughout the economy . In this aspect China’s reforms deviate the most from those in other parts of the world . In the initial phase of property rights reforms, Chinese leaders chose not to disrupt agriculture any more by reforming the up- and downstream sectors. In essence, the procurement and input supply systems remained fully under the control of the state during the early reforms. The same state-run input supply channels that provided inputs to the communes channeled inputs to farmers. Likewise, the same procurement system that purchased the output of the commune and transferred it to the cities remained virtually unchanged and banks continued to finance these transactions. Sector officials carried out transfers of food from producer to consumer regions according to nearly the same plan as before reform. Even though the maintenance of the system of planned procurement and supply in China caused substantial allocative irrationalities, the benefit of such a strategy was that it did provide farmers access to inputs and product outlets during the period of property rights reforms and farm restructuring . With improved farm productivity it actually allowed increasing the supply of food to urban consumers. The leadership’s emphasis on stability mandated the gradual strategy . The deregulation of the input and output marketing was only allowed to take place at a more gradual pace several years after the initial reforms . The gradual liberalization strategy, called the dual track pricing system, allowed enterprises to reap the informational benefits from price liberalization while avoiding the disruption associated with the breakdown of the planning system.

It also allowed space for traders to slowly develop networks and figure out ways to finance commodity trade . The importance of creating new institutions to facilitate the exchange of inputs for outputs and the trade of commodities can also be seen by observing the differences in the recent performance of the CEECs and Russia. While output in Russia continued to decline, the output fall in the CEECs halted as these economies had begun to find new ways to undertake transactions in the food economy . In other words, an important source of increased productivity in transition economies has been the emergence of new institutions for information, product exchange, and contract enforcement. Such institutions have come in a variety of forms. The most successful ones have frequently depended on private enforcement mechanisms within the framework of specially designed contracts or institutional arrangements . Contracts between private agents act as substitutes for missing or imperfect public enforcement institutions . Successful institutions have offered enough flexibility to allow producers, suppliers,nft hydroponic and buyers to adjust to the continuously changing environment during transition. For example, while land lease contracts initially often took the form of short, single-season informal contracts, gradually they have evolved into more formal and longer-term contracts, reflecting reduced uncertainty and improved understanding of the market environment by both the owner of the land and the tenant. Leasing of equipment is another example of an institutional innovation adapted to transition as it mitigates farms’ collateral problems in financing new equipment. Foreign direct investment has played an important role in the reemergence of the institutions of exchange in some CEECs . Beyond supply of capital, foreign firms have offered producers a number of arrangements to encourage greater production and marketing and to overcome constraints that have limited economic activity since the onset of transition. For example, food processors have negotiated contracts with banks and input suppliers to provide farms with inputs that enable them to deliver high quality products to their company. Similarly, input supply firms have been involved with assisting farms to find guaranteed outlets for their products in order to stimulate farms’ demand for the company’s products.While an analysis of general transition is beyond the scope of this paper, it is impossible to ignore entirely the economy outside of the agricultural sector because it has had important effects on agricultural transition. General reforms have affected agricultural transition in a variety of important ways. We focus here on some key aspects. First, macro-economic stabilization, including the reform of fiscal and monetary institutions, is an essential element for sustainable growth. A recent comparison of overall performance of the CEECs and FSU countries concludes that rapid overall liberalization and sustained macroeconomic stabilization have laid the basis for gradual institutional change in the more advanced transition countries . At the same time, the report states that the persistence of soft budget constraints in less advanced countries has jeopardized stabilization. But far from disappearing, the state has a major role to play in the formation of macroeconomic policy.

Transition from a socialist to a market economy does not imply a withering away of the state, but rather a fundamental redefinition of the role of the state in the economy . The state must play a strong and leading role in developing market institutions. Interestingly, both in China and in the most advanced CEECs, the state has been able to do this, although often in different ways. In Russia, however, the state has not redefined its role. Instead, in many aspects, the Russian state has withered away and has been unable to fulfill some key roles for the development of a market economy . The state has eroded in establishing the rule of law, as private enforcement has gained the upper hand in Russia . In many sectors, non-state entities have begun to collect taxes and establish the basic conditions for macro-economic stability. For example, estimates put the share of transactions which are carried out as barter or with money substitutes at 75 to 85 percent in Russia . Obviously these developments have strongly affected the climate in which the agricultural transition has taken place, since farm producers, like agents in any industry, need stability, clear legal codes, and can benefit from investments made by the state. The nature of a good macro-economic environment may also attract or deter outside interests from entering the local economy. For example, the flow of FDI and foreign technology and know-how into the agri-food chain has been important in the CEECs, but less so in Russia. One of the main reasons for the high level of outside interest in some CEECs has been narrowed to the progress of the general reforms, the macro-economic situation, and the prospect of EU accession . Macro-economic stabilization and reform progress have not only improved access to foreign capital, technology, and know-how, but also access to domestic credit and capital sources for the farms. Credit markets have developed notoriously slow in the CEECs and FSU countries. Disruptions by privatization and overall restructuring severely limited farm credit access for investment purposes and working capital .The success of the recovery in some CEECs is at least partially due to improvements in the capital situation for the farms. Enterprise privatization also has had important impacts on agriculture. While land reform and farm privatization procedures were specific to agriculture, the privatization of companies involved in supplying inputs and credit to farms as well as food processing and distribution companies followed the general privatization procedures, a process that has differed significantly among countries. In a review of the successes and failures of privatization, Kornai concludes that three aspects of privatization strategies contributed to successful privatization. First, it is necessary to create favorable conditions for bottom-up development of the private sector, including the creation of new companies. Second, selling of state companies to strategic investors has led to more satisfactorily results than strategies based on some form of give-away, e.g. through vouchers. Finally, de facto privatization occurred by hardening the budget constraints of companies . All of these strategies have had a major impact on the performance of the agri-food sector. For example, Hungary, a country that has sold most of its food processing companies to foreign investors, received the highest per capita inflow of FDI in the agri-food sector, and has consequently experienced some of the greatest growth in output and productivity . Finally, external economic conditions, as well as government policies, have affected the outflow of labor from agriculture during transition, a trend that has major implications for agricultural productivity and rural incomes.

One advantage of this process-based approach lies with its reliance on simple regressions

Several California crop disease climate models are in development and are available, including fire blight , scab , alternaria leaf blight , and brown rot . For the farmer, potential adaptation strategies for pests include choice of crop, growing season, manipulative cultural practices, fertilization, pest control, and irrigation, or a combination of these , many of which are currently used to control weeds in agriculture. Yet, there are often trade offs involved that can benefit pests as well . An effective adaptation plan depends on accurately casting predictions, but such predictions are difficult when the impact of undesirable organisms is based on a complex network of interacting factors. Maladaptation can result in negative effects that are as serious as the climate change-induced effects being avoided . Nonetheless, two endeavors stand out as productive methods of ultimately reducing the impact of invasive plants and weeds in California’s changing climate: an increase in our understanding of interactions in an ecosystem context and increased vigilance. Though many competition experiments have been conducted on the effect of rising CO2 on weed-crop competition , both our understanding of how such effects change in an ecosystem context and how such an effect interacts with other aspects of climate change is rudimentary and is insufficient to formulate respectable predictions in California’s future climate. This is further confounded by uncertainty associated with future precipitation patterns and those of El Niño events in California. As a second adaptation, increased vigilance will serve to identify new invaders early, thus dramatically increasing the potential for successful eradication . In terms of increased vigilance,nft hydroponic the “guilty until proven innocent” approach in which each threat is assumed to be dangerous, shows promise.

Where resources are limited, likely problem areas should be targeted, such as disturbed habitat, especially along roadsides and other dispersal corridors, and points of entry. The impact of climate change on pest and disease outbreaks is difficult to predict because it involves changes in both the vigor of the predator and the vulnerability of its prey. Plants do not experience climate change alone, but as part of a wider ecosystem incorporating their pests, pathogens, symbionts and competitors . Although arthropod pests and weeds do interact with each other, strategies aimed at managing one or other of these classes of threats, rarely consider such interactions . Furthermore the great diversity in commodities produced in California, coupled with the abundance of natural vegetation and weeds can provide an important refuge for pests and diseases causing microbes to survive in, at times when their primary crop host plant may be absent. Species with small geographic ranges are more vulnerable to climate change than widespread ones . This is also true of specialist versus generalist pest species. One possible adaptation is to modify planting dates or the selection of cultivars that are resistant to emerging pests and disease causing microbes. As with weeds this dictates the need for vigilance and accurate predictions of pest/disease outbreaks. Implementation of multifaceted pest and disease management strategies such as those applied in IPM will likely enhance the adaptive capacity of producers in a changing climate. Many of the strategies currently used to control disease and pest outbreaks will likely be successful in the climate of the future. Human responses to climate-induced pestilence need to be adaptive and inventive. Agricultural pest control is already a complex and expensive endeavor. For example, increased pesticides are an obvious adaptation; however, this approach has many drawbacks .

When combating Pierce’s disease, for example, in addition to conventional methods such as inspection, pesticides, and host removal, other technologies that are being employed to better control the disease in California, including biological control, sequencing the pathogen genome , and identification and breeding of disease resistant vines . In order to buffer against the unknown interacting effects of climate change, bet-hedging strategies should be used that reduce host pools such as maximizing spatial and temporal crop intra-specific genetic variation . The judicious use of genetic technologies may also prove important in stemming invasions and epidemics by adding to our range of available tools to deal with such challenges. Issues of precipitation are critical. A warmer drier California will likely have a very different pest, weed and disease landscape than a warmer wetter California. Furthermore, research is needed to understand the effects of climate change on the ecology and evolution of agricultural pests. The effects of climate variability on coevolution, virulence, and resistance to control methods are at best poorly understood. For example, does the efficacy of taxon-specific chemical control shift, if at all, in warmer and/or more variable environments? This question is important across all taxonomic levels, from vertebrate pests to microbial pathogens. Changes in competitive balance and trophic interactions are difficult to predict for future climates. Nevertheless, field experiments can be conducted across existing climate gradients representing current and future conditions. Such studies are lacking. Landscape surveys are also instructive in pointing out the value of non-crop habitat in pest control, and in determining spatial and temporal gradients that affect pest distribution . The effect of higher temperatures on overall abundance of herbivorous insects remains unknown in the absence of equivalent data of their natural enemies . Furthermore, efforts to link information specific to California weather to disease and pest outbreaks are limited in their number .

Concerted efforts are needed to monitor and compile data, including historical records. The development and validation of prescriptive control models depend on these data. Currently, climate disease models in California are developed on an as-needed basis with temporary funding often provided by private agricultural interests . Hence, no long-term efforts or programs exist. Increased development is necessary in the use of continuing programs such as the disease warning systems recommended by Wu et al. . Long-term sharing, coordination, and modeling of pest outbreak and environmental data among the diverse climate regions within California would greatly improve our understanding and ability to prepare for, adapt to, and mitigate against future pest risks and disease causing agents. Pests and pathogens that may become significant in California agriculture need to be identified and appropriate quarantine and inspection measures implemented to avoid introduction. Looking to other regions where the climate is similar to that predicted for California in the coming century will also likely be instructive.Land use refers to the management regime humans impose on the biophysical attributes of the earth’s surface. Temperature or rainfall patterns associated with climate change may alter land use and land-cover distributions ,nft system and consequently basic patterns of productivity, stability, and sustainability in agroecosystems . Conversely, the effects of human-induced greenhouse gas fluxes and C sequestration that is attributed to land use and management can, in turn, impact the rate and magnitude of climate change . For example, cultivation of forest and grassland soils accounts for approximately 25% of the net loss of C in the United States, while N fertilization, no-till farming, and grassland restoration have only slightly reduced these losses . Issues of agricultural land use change are particularly interesting in regions with Mediterranean-type climates; they have typically experienced high population growth, urban expansion, and decreasing self-sufficiency in terms of producing their own food, due also to the export value of the many specialty commodities they produce. In California, these issues raise questions related to the sustainability of agriculture, both economically and environmentally. Given the potential growth of California’s population to 9 million people by the end of the century, urbanization is probably the single largest factor driving land use change in California’s agricultural landscapes, farmland loss, and the increasing utilization of wetlands and riparian corridors that serve as wildlife corridors .

Urbanization could result in a loss of 35% of the prime agricultural land in San Joaquin Valley counties, and much of the remaining agricultural land in coastal counties, even when climate change is not considered in the projections . This section will 1) introduce the approaches commonly used to assess climate change effects on land use, 2) discuss the fundamental drivers of land use change, and 3) evaluate knowledge gaps in current mitigation and adaptation strategies for climate change-induced land use shifts in California.Climate change impact assessments commonly employ a hierarchy of models which, ideally, are integrated to simulate the most important processes, interactions, and feed backs in the systems. At the top of the hierarchy are Global Circulation Models , which simulate global climatic patterns on a grid with cells sized between 2 and 9° longitude and/or latitude and several vertical layers thick. Results from GCMs are then used as inputs to biophysical models, which also rank at the top tier of the hierarchy. Outputs from biophysical models are subsequently used as inputs to economic models at, for example, the farm level . Models at the regional scale are more suitable to estimating climate change effects on land use. While some GCM predict gains of 20-50% in potential agricultural land for North America , regional models provide projections at greater resolution and detail. Regional models have forecast that certain crops will be forced to shift out of their current geographical range due to increasing temperatures , but these losses in productivity may be partially offset by increased productivity from increased CO2 levels . Other crops especially C4 plants might suffer lower yields due to elevated atmospheric CO2 levels , though California produces few C4 commodity crops. As Section 6 points out, less is known about how temperature and CO2 concentrations affect key developmental phases of horticultural crops, and thus their vulnerability to climate change. Climate analogs can provide some insights into land use change. Using the hot, dry decade of the 1930s as an analog of the possible climate that might occur in the Missouri, Iowa, Nebraska, and Kansas region as a consequence of climate change, Easterling and Apps modeled crop responses. They found that farm management changes and slight increases in productivity of some crops, for example, irrigated wheat, could eliminate 80% of the negative impact of the analog climate, thus minimizing potential land use change. In California, an analogy of climate change, the drought of 1987-1991 demonstrated that farmers increased their reliance on ground water, adopted water-conserving technologies, reduced water use per acre, moved away from water intensive crops, and fallowed more land . The drought instigated the official approval of water trading and demonstrates how extreme events can trigger rapid changes in land use and social institutions that increase adaptation to climate change. Different approaches have been used to predict climate change impacts on the agricultural landscape, sometimes resulting in very different outcomes. The first approach is a process-based one that arbitrarily or synthetically forecasts a specific climatic change by varying temperature, precipitation, or another model parameter and is likened to a simple sensitivity analysis .Some weaknesses of this approach include 1) the utilization of significant amounts of primary data that are constrained in time and/or space; 2) requisite stable equilibrium conditions; 3) omission of changes in crop physiology and ecosystem productivity, adaptive human behavior, and land use; and 4) neglect of interactions with land use and responses to environmental change . The California SWAP/CALVIN model is similar to this approach, and it predicts relatively feasible changes in terms of crop management and land use change to maintain crop productivity . A second approach models the responses of crops and farmer behavior based on extrapolation of responses of varying climates observed at other sites to the system of interest, and does not necessarily consider unique adaptations that may increase success during transition to a new climate regime . This latter approach is more akin to the approach of Hayhoe et al. . In this case, predicted effects of climate change on wine grape production are more negative than what would be indicated by the SWAP/CALVIN model, suggesting more problems associated with adaptation, and greater changes in land use patterns. Thus, different potentials for land use change emerge from different modeling efforts. More work is needed to improve the accuracy of modeled forecasts of climate change, and to produce results that are accessible and will allow a wide range of user communities in agriculture to adapt to climate change.