Organic Farming

NMIMS’ SARLA ANIL MODI SCHOOL OF

ECONOMICS

ECONOMICS OF ORGANIC FARMING

WITH A MAJOR FOCUS ON

DEVELOPING NATIONS

Seminar Paper

Aayushi Kapadia

A001

ABSTRACT:

The paper deals with a cost and benefit analysis of organic farming. Production costs

involved in organic farming ideally is supposed to be low but no clear conclusion could be

drawn about the profitability of farmers adopting organic farming from the various

researches done across the globe. The costs and returns on organic farming depend on a lot

of factors including the farmer’s expertise, availability of inputs, government support, and

environmental conditions and others. As organic farming involves high risk in the initial

years of conversion when the farmers do not possess the certification, the soil is low in

fertility, the farmers are not well equipped with the various methods of sustainable

management on the farms, small and marginal farmers especially in the developing nations

are hesitant to practice organic farming. If adopted With the high price premiums and

ideally low costs and the positive externalities that it provides, organic farming is a suitable

option for farmers not only the developed but the developing nations, if adopted in the

correct form. Thus, the governments along with international organizations need to take

steps to encourage adoption of organic farming. Few recommendations are suggested in the

paper.

INTRODUCTION

Many of us get overwhelmed by the exorbitant size of strawberries at the supermarket. The

secret behind it is the extensive use of synthetic chemicals which is a result of intensive

conventional farming whose use has grown leaps and bounds in the past few decades. The

increase in food production is accompanied by a multitude of problems such as

overexploitation and deterioration of natural resources, reducing soil fertility, pollution of

land and water, increase in health problems because of use of synthetic chemicals on fields...