A reply to “BULOG: A good or confused choice”

Editor’s note: We have commitment to promote discussion on various topics on Indonesian development especially those that have been covered by our past articles. The following comment by YS Tey (John) on our previous post entitled “BULOG: A good or confused choice” is interesting and deserves more attention. We thank John for sharing his thoughts.

YS Tey (John)

A strong message from the recent Food Price Crisis was “business-as-usual” models are not sustainable in challenging environment. While the message did not provide an absolute answer to the model, it did suggest that a total reliance on a SINGLE POLICY is not likely to handle the complexity in food security.

Risti has debated two policy options: self-sufficiency and self-reliance. The former sounds objectively appealing. However, the latter is indeed more practically appropriate. In simple expression, that is to import food when world prices are cheaper than home production. Doing so will release domestic farmlands for other agricultural activities that have relative comparative advantage.

The question is what are these “other agricultural activities”? I do not have an answer to that. Indonesian economists obviously have to follow up. That should be done in the spectrum of general equilibrium in order to make justice for food security and relative comparative advantage.

Researchers should, however, be realistic. Statistical results that show relative comparative advantage could be meaningless if the implications do not match with the reality. E.g., wheat has lower production cost but it can only be grown at high latitudes in Indonesia. Here wheat is used as an example to highlight the extreme of economic analyses that ones may obsess with.

Careful consideration is indeed required! Pure economic studies always fall short of that. Could we call upon agriculturists and farmers to look at that complex issue? I bet these non-economists have better insights into what agricultural activities are doable and non-doable. By saying so, I do not disregard the importance of economists. Rather, multidisciplinary insights can definitely lead to better and practical policy options. Are economists willing to walk out and talk? Go ahead!

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Filed under Climate change and environment, Economic development, Food and agriculture, Indonesia, Review of article, Trade

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