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tion of marketing methods, services, charges, and costs. They realized from the beginning, however, that positive improvements in marketing efficiency—using the latter term in its broadest sense—would require not only an acute appraisal of the marketing process but, in addition, the devising of concrete procedures ready for application at key points. Accordingly, in the early 1950's the researchers increased the number of lines of work involving the intensive investigation of alternative methods of performing various functions and services. They compared individual and total inputs and selected the most efficient methods in relation to such variables as overall volume, length of season, location, and relative availability and costs of capital and labor. Frequently optimum means for performing certain functions were integrated and synthesized into plans for model plants. In a number of cases the cooperation between economist and engineer accounted significantly for the successful completion of such research.

Paralleling the shift toward studies of cost and efficiency in firm operations and in the performance of specific marketing services has come a growth in technological studies. This term refers to a wide range of physical and biological research directed toward improving processing methods and maintaining quality of products in storage, transportation, and wholesale and retail channels. Physical and biological scientists on the one hand and economists on the other have worked together to devise new methods and processes and, at the same time, to determine their economic feasibility.

The stations in recent years have paid increasing attention to the organization and structure of markets and the impact of changes in structure, organization, and institutions, on the returns received by farmers. This interest has arisen in turn from important changes that have been occurring in interfirm relationships, in size of individual firms, marketing technology, financing, pricing, and management strategy. Much has been heard of integration in food marketing in the United States, that is, the extension of control by a single firm over two or more stages of production or marketing or both. Integration is not new to industry, but has increased rapidly in the food industries since World War II. Paralleling integration and somewhat interrelated with it is the accelerating movement toward larger firms in food processing and handling. Within the past 25 or 30 years these two developments have proceeded on such a scale as to lead to (1) a marked shrinkage of transactions in markets traditionally regarded as mechanisms for price discovery and (2) substantial disadvantages for small farmers unable to meet the demand of large-scale buyers for continuous supplies of a relatively uniform quality of prod

a ucts. Questions are being raised as to whether elements of monopoly or at least oligopoly are not becoming so widespread as to threaten the elimination of the small firm in both agricultural production and marketing and perhaps pose a serious challenge to public welfare in terms of the ability of marketing agencies to controÌ marketing margins and prices to both producers and consumers.

MARKETING RESEARCH EVALUATED

Despite the increased emphasis placed on marketing research in the past decade, the economic position of agriculture has worsened rather than improved. Does this trend mean that the expanded pro

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gram of marketing research has had few benefits? This conclusion does not appear warranted, despite the imperfections in the research program of recent years. More clearly evident is the hard fact that forces, much too powerful for marketing improvements to cope with alone, have shaped the structure of income and prices. Undoubtedly marketing research has contributed to increased efficiency in the Ameriican marketing system in recent years; nevertheless the downward pressure on farm prices and incomes has exceeded the counteracting power of research activity aimed at lowering marketing costs and expanding outlets.

The forces depressing the level of farm prices include the continued concentration of the population of the United States in large metropolitan areas, a further increase in the proportion of homemakers employed outside the home, continued emphasis by food processors and handlers on the manufacture and promotion of convenience foods, and further specialization of agricultural production in areas distant from the major centers of consumption. These and other developments represent an increased demand for marketing services. Efficiency as measured by output per worker in marketing has risen significantly, but such changes in efficiency have not been sufficient to offset the effect of higher wages and other cost rates.

The rising output of the American farm itself, moreover, has contributed even more significantly to the declining level of farm prices. Aggregate food and fiber output, accompanied by highly inelastic coefficients in both the price and income sense, climbed to a level 23 percent higher in 1959 and 1960 than in the period 1947–49. Production increases of this magnitude have inevitably brought about weakness in farm prices and incomes, notwithstanding rising domestic population, substantial additions to stocks, and various measures designed to dispose of surpluses in foreign markets.

Market researchers still believe that improvements in marketing efficiency are important but are beginning to give increasing attention to other and relatively neglected problem areas heretofore not intensively studied. This trend reflects an increasingly forward-looking attitude in research and an overall maturing of the research program. They believe that scientists should delineate and explore emerging new problems of marketing well in advance of the time when public administrators must make decisions in policy. New directions in research are taking marketing economists farther and farther from the farm and the farmer and leading them into commercial, industrial, and consumer markets where prices are discovered and demand originates. Already scientists are studying price and income policies, searching especially for workable and acceptable mechanisms for adjusting the supply of farm production to demand. Once the causes and the impacts of trends have been discerned, as in the case of integration, economists should be able to develop alternative courses of action to preserve or attain specific situations which society may consider desirable.

The station scientists are beginning to deal more attentively with the problem of finding new or widened markets for products and services traditionally considered to be minor sources of farm income, including forestry and outdoor recreation. If the national timber area, half of which is on farms, is to increase its productivity in line with needs indicated by the Forest Service, then innovations in both production and marketing, probably assisted by changes in public policy, will be required. Furthermore, outdoor recreation is one of the rapidly increasing industries of recent times. Thus favorably situated farms face the profitable prospect of selling rights to engage in fishing, hunting, camping, and other forms of outdoor recreation. The research required for these purposes often will require the attention of production as well as marketing economists, and in some cases close collaboration between two or more disciplines will be essential.

Finally, economists are increasingly visualizing the problem of national price and income policy, as well as other

aspects of policy, from a world-wide perspective. They recognize that the great productive capacity of American agriculture, the pressure to dispose of surpluses abroad, the alleviation of hunger, the promotion of foreign economic development, and the effectuating of overall United States foreign policy must be brought into a more rational harmony.

LITERATURE CITED

(1)

EXPERIMENT STATIONS COMMITTEE ON POLICY.;
1940.

MINUTES, AGENDA CHICAGO MEETING, NOVEMBER 8.

172 pp.

(2)

65 pp.

(3)

(4)

1941. MINUTES, AGENDA WASHINGTON, D.C., MEETING, JANUARY 4. HOPE, CLIFFORD R. 1951. A VISUALIZED PROGRAM FOR MARKETING. A speech delivered Feb.

12, 1951, under the auspices of the Graduate School of the U.S.

Department of Agriculture. 12 pp. STATE EXPERIMENT STATIONS DIVISION, AGRICULTURAL RESEARCH SERVICE. 1960. MANUAL OF PROCEDURES FOR STATE AGRICULTURAL EXPERIMENT STA

TION RESEARCH UNDER THE AGRICULTURAL MARKETING ACT OF 1946.

8 pp. U.S. Dept. Agr.
UNITED STATES CONGRESS.
1925. [PURNELL ACT.] AN ACT TO AUTHORIZE THE MORE COMPLETE EN-

DOWMENT OF AGRICULTURAL EXPERIMENT STATIONS, AND FOR OTHER
PURPOSES. APPROVED FEBRUARY 24, 1925. (43 Stat. 970.)

(5)

(6)

1946.

PUBLIC LAW 733. AN ACT TO PROVIDE FOR FURTHER RESEARCH INTO
BASIC LAWS AND PRINCIPLES RELATING TO AGRICULTURE AND TO IM-
PROVE AND FACILITATE THE MARKETING AND DISTRIBUTION OF AGRI-
CULTURAL PRODUCTS.

(U.S. Congress, 79th, 2d Sess., Ch. 966, H.R. 6932.)

11 pp.

3

Minutes and agenda of ESCOP meetings referred to in this and other chapters are not generally available in libraries. The archives, however, do contain copies of these documents.

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Leaders of the State agricultural experiment stations and of the Department of Agriculture recognized the merits of cooperative research and the regional nature of many research problems in their earliest meetings. As station programs expanded, the need for coordination and correlation among research workers increased. The directors supported regional conferences and cooperative projects for this purpose, but lack of a formal program and of specific funding delayed the growth of regional research. In 1946, the directors framed a special provision for Federal legislation which provided the means for the development of the cooperative regional research program of the State stations (18).

REGIONAL RESEARCH CONCEPTS DEVELOPED

The founders of the State agricultural experiment station system and the first station directors had cooperation and organized effort foremost in mind (13, p. 83). Administrators and research workers readily understood and expressed the potential advantages of cooperation on problems of wide and important concern. Many years elapsed, however, before organized regional effort materialized. There were several principal obstacles to effective regional cooperation: commonwealth restriction of interstate travel, limited funds for research, and the intrinsic reluctance of scientists to participate in group research.

The growth of agriculture in the Nation brought an increase in demands for research on the State stations without proportionate increases in public funds. Research workers of the State stations and the Department agencies organized regional conferences for more effective use of resources and exchange of information. Several pioneering regional research efforts developed out of these conferences. Beginning in 1913, for example, livestock research workers of the Southern States met regularly to discuss their major problems in the production of livestock. They completed plans for cooperative regional research, agreeing among themselves as to what each institution should do including the precise role to be played by each. In 1922 they established a livestock council which recognized three classes of problems southwide, regional, and State—and agreed to consider only the first two. A specific problem area, such as soft pork, was selected for regional research. The Department entered into agreement with each cooperating institution (4), specifying: (1) the leaders of the project; (2) objectives of the work; (3) procedures; (4) the cooperative system; (5) physical locations and plans; (6) publication.

* Italic numbers in parentheses refer to Literature Cited, p. 205.

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