In the 1960's, we developed a strong public conscience about the environment. The 1970's will reveal a great deal about our ability to better understand and manage the environment in socially acceptable ways. This task will require both theories and measurement techniques to empirically verify them. A welfare theory (based largely on Paretian welfare economics) states that we can say one system is preferable to another if the system makes at least one person better off and no one worse off. Most alternative systems in the real world, including those available to resolve pollution conflicts, do not meet this criterion. A change in the system normally makes someone worse off. Thus, Paretian, or the “new,” welfare economics, is not really useful in making most policy decisions. The problem is compounded, because often we do not know how to measure the real effects of pollution on parties involved in and influenced by pollution. This later problem is aggravated by the fact that we have done very little to systematically record observations on pollution processes.

The quality of our environment is of great concern in our society today. Hence, we are personally and academically concerned. One general topic is directed toward “The Economics of Pollution Control.” I much prefer to approach this subject from the point of view of the optimist and define our orientation as that of opportunity and positive attitude toward our environment. Thus, we approach the subject in terms of the quality of our environment, rather than in terms of pollution control. The shock effects, from discussing pollution, have registered with most of us so we can proceed with the opportunity to improve the quality of our environment.

Over the past two years, a national commitment to reduce pollution has emerged. Firms and governmental units will be required to internalize most, if not all, costs associated with pollution control. This will move us in the direction of reducing the social costs associated with environmental quality deterioration. The subject of social costs or “externalities” has been widely discussed by economists [5].

The past year launched us, not only into the decade of the 70's, but also into a period of intense concern about our environment. We have been bombarded by prophesies that range from those expressing no real concern to those saying the very survival of man is questionable.

There is a general consensus that we do have problems, but that we can deal with these problems if the nation will just get serious and place a high priority on environmental programs. We can cite past records of success, once specific objectives have been accepted as national goals. World War II and the conquest of space are but two recent examples.

The title of this article restricts our discussion to training for commercial farm management. As most are aware, however, the structure of the entire agricultural business complex has changed greatly in recent years. We have seen a sharp growth in the number and size of commercial farms with resource capabilities far beyond those of traditional family farms, the transition in some agricultural industries (as in broiler production and cattle feeding) to factory types of operation, and vertical integration of food and feed companies toward agriculture and even into farm production. We are also observing the development of agricultural corporations. Some of these are integrating into agribusiness operations and in conglomerate patterns. For example, some of our Texas cattle feeding corporations have now merged with chemical companies or oil firms, and one has acquired a large scale broiler enterprise. A number own and operate ranches or meat packing plants. One or two have established subsidiary credit corporations.

Since its inception, Extension has been involved in constant self-study activities which have often resulted in modifications in program, structure and performance. Innumerable pilot projects have been proposed, many have been tried, and some have been woven into the basic fabric of the traditional Extension program. New technology and sociological changes in rural America have generated forces of change to which Extension needs to adapt to survive as a contributing agency supported by public funds drawn from private taxpayers who also happen to be voters. The arrival of the seventies does not herald a sudden crises, we and our predecessors have been through this before, but the tempo increases at a rate related to that of the so-called knowledge explosion we hear so much about.

In 1954, W. Arthur Lewis published his well-known landmark article conceptualizing a two-sector model of a developing nation, and centered his analysis around the classical assumption of an unlimited supply of labor [12]. The two sectors in the model consisted of the non-capital-using subsistence sector, and the capitalist sector which used reproducible capital. Among the key features of the model was the gain in productivity to be derived from the transfer of labor from the labor-abundant subsistence sector to the more productive capital-using sector. Given an assumption of a negligible marginal productivity of labor in the subsistence sector, labor could be transferred at a very low opportunity cost and with very little required increase in wages. Cheap labor was viewed as a boon to development since it produced a “capitalist surplus” which could be reinvested in capitalist enterprise for continued growth. This capitalist surplus would continue to be reaped so long as there existed surplus labor in the subsistence sector to provide labor to the capitalist sector at a constant wage. The capitalist surplus was viewed as the key to the model since it was assumed that savings and investment were available primarily from profits and not from wages or rents.

Our society has demonstrated distaste for the poverty that exists in our midst and dissatisfaction with present welfare programs. Though numerous plans have been suggested, there is as yet no comprehensive measure to alleviate income problems and replace current welfare programs. Among suggested programs are various negative income tax plans, childrens' allowances and the Family Assistance Plan. The negative tax plans examined include variations from those originally proposed, but will be identified by the name of the original author whose plan they are most like. The Family Assistance Plan was outlined by President Nixon in August 1969.

A 1964 survey of 500 wheat producers in Oklahoma and Kansas revealed that the cost-price squeeze is most commonly viewed by farmers as the major cause of chronically low farm income.The cost side of the squeeze is widely attributed to the wage-price spiral caused by cycles of wage and input price increases negotiated between labor unions and imperfectly competitive firms, and to rising taxes and interest rates.

The general economic functions of market information are familiar and can be logically related to the concepts of workable competition and the perfect market in space, form, and time. However, the importance of a formal market news service to the efficiency of performance of markets must be viewed within the context of the particular situation and the manner in which present information systems function. Wherever there is a market, an information network exists, even though (in some cases), slow, inaccurate, discriminatory in its availability to market participants or limited in the scope of information collected and diffused. Therefore, in assessing the need for introducing or expanding formal market news services, the adequacy of the present system, the cost of effecting improvements and the consequences that may be derived from them must be determined and evaluated.

In general, investigations of the cattle cycle have concentrated on the cyclical fluctuations in inventories based on the number of head of cattle on farms as of January 1. The emphasis in studies of the cycle in numbers appears to be on providing a system of logic to explain why a cycle could or even should exist. Very little attention has been given to describing in any precise manner, the characteristics of “the cycle.”

Texas has developed into a major cattle feeding State during the past few years, mainly because of the existing favorable feed/cattle price relationships. These price relationships are the result of the surplus production of both grain sorghum and feeder cattle within the State and the demand for fed beef in Texas, in other Gulf Coast States, and in California.

Cattle feeding in Texas has been characterized in the last decade by large increases in cattle marketings and rapid expansion of the number of feedlots with capacities1 greater than 1,000 head [3]. To illustrate this dynamic growth, Texas fed cattle marketings increased by 1,950,000 head from 1962 to 1969 and more than doubled its relative proportion of the total marketed cattle from the twenty-two major feeding states [13]. During the same seven-year period, Texas cattle feedlots with capacities over 1,000 head increased from 120 to 300 [13, 14].

The variables a manager faces in making decisions may be divided into two broad categories—those which are determined by the manager and those which are outside of his control. Agricultural economists have made many efforts to develop expectation models for one or more of the uncontrollable variables facing farmers and have suggested procedures for utilizing the resulting expectations. Recent developments in statistical decision theory provide a logically consistent framework for incorporating the predictions of expectation models [4, pp. 192-196]. Applications of Bayesian analysis utilizing predictions of one uncontrollable variable have been reported in the literature [1, 3]. However, many decision problems logically require expectations of two uncontrollable variables (such as price and yield) or more. This article illustrates a method of including predictors for more than one uncontrollable variable in the Bayesian framework, and reports some empirical results of an application to a stocking rate problem.

The concept of demand has evolved through the centuries, enriched by the natural-value, exchange-value controversy and the diamond, water paradox of the classicists [11], the intuitive insights of Marshall [8], and the mathematical rigor of Slutsky [10], and Hicks and Men [6]. These developments led to the conceptualization of a demand function as a solution function to a constrained extremum problem [5,6,9, 10].

The consumption of a number of agricultural products varies from one season of the year to another. For some products, seasonal variations in consumption correspond to variations in production. For others, such as fluid milk, consumption and production patterns tend to vary inversely, Downen [2] reported significant seasonal variations in daily average sales of fluid milk with the highest sales occurring in the fall and winter months and the lowest in the spring and summer months. Other studies [1,5] have also reported seasonal variations in per capita sales of fluid milk. Conversely, production of fluid milk naturally tends to peak in the spring and summer months and reach its lowest point in the fall and winter.

Soybeans occupy the unique position of common denominator in crop production for much of the Eastern half of the U.S. The interdependence between the soybean economy and those of corn, cotton, and rice means that policy changes directed toward one crop can have very decided effects upon the others.

Effective policy and program decisions need continuing research as input in formulating and evaluating these decisions. Detailed analyses of inter- and intraregional interdependence among crops, and of production alternatives involving soybeans, are especially needed because it is no longer certain that an expanding demand will provide a safety valve for soybean and related commodity programs [4,9].

Traditionally, the economics of farm number adjustments have been inferred from the relative positions of firms on a longrun average cost curve. The steep slope of the left portion of the commonly drawn curve suggests demise of the smaller units as fast as off-farm and inter-farm markets can absorb their labor and land resources. On the less steeply declining middle portion of the curve, insufficient volume of output (income) is suggested as a cause of firms quitting. The argument is supported by the fact that most empirical estimates do not show the long-run cost curve rising at large outputs. This places downward pressure on product prices, reducing per unit margins, and creating income problems for the middle group of firms. Adjustments in the farming sector are then viewed as constrained by the limitations of factor and product markets, as well as by values and traditions of farm people.

As agriculture adapts to the seventies, farm businesses are faced with several adjustment problems. Many farm firms must grow into a more viable economic unit or be forced to exit from farming. For some firms, growth will require gaining control over additional land resources, while for others, expansion will require a more intensive use of presently controlled resources.

Attention is now focused upon problems confronting our Nation in the area of environmental pollution. There is a close correlation between industrial and agricultural expansion and increases in population over the last few decades. There is also a pronounced association between increases in population and the magnitude of pollution problems. As an example, there is some concern about environmental pollution associated with power production which is rapidly expanding to meet the demands for electricity of an increasing population and industrial complex. Power production expansion is occurring largely in areas which already have high population densities.