Agricultural Policy of the United States. by Harold G. HalcrowReview by: Ivan M. LeeJournal of the American Statistical Association, Vol. 48, No. 263 (Sep., 1953), pp. 663-665Published by: American Statistical AssociationStable URL: http://www.jstor.org/stable/2281023 .

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BOOK REVIEWS 663 careful reading, and should serve to point out what can be accomplished, and what cannot be accomplished in this difficult field.

Agricultural Policy of the United States. Harold G. Halerow. New York: Prentice- Hall Inc., 1953. Pp. vi, 458.

IVAN M. LEE, University of California (Berkeley)

THE material in this book is presented in three parts. Part I is given over T to a discussion of what the author calls the agricultural setting. Population trends and future prospects, trends and relationships in selected subaggre- gates of agricultural production, and the behavior of aggregate agricultural income over time are summarized briefly in this part. Most of the remainder of Part I is devoted to a diagramatic and elementary numerically illustrated discussion of selected economic concepts such as supply, demand, elasticity, and costs. Part II is very brief, containing the author's version of a useful classification of the objectives of agricultural policy under the headings: (1) increasing efficiency, (2) raising and stabilizing farm income, and (3) im- proving social welfare. Part III occupies about one-half of the book. In this part a wide range of government legislation affecting farmers is discussed under appropriately chosen chapter headings.

In a review of a book which is offered as a textbook in agricultural policy, it would seem appropriate to pay some attention to the question of what consitutes the field of agricultural policy. The author, in his opening remarks in Part III (p. 208), suggests lines along which agricultural policy as a field of study might, in the opinion of this reviewer, be fruitfully developed: u ... The student of policy must become a student of economics, sociology, and political science, as well as several other subjects if he wishes to obtain a broad understanding of the field.' Having recognized the broader aspects of the field, the author chooses to restrict his analysis to the much narrower point of view of economics. He states (p. 208): 'Our emphasis is on eco- nomics. Our problem is to recognize the economic and political forces at work and to bring economic analysis to bear on the problems under discus- sion. . . . We cannot consider in one book the implications for policy of all various disciplines such as philosophy, political science, and sociology. ... We shall talk about political interests and pressure groups. But we shall place our major emphasis on the economic analysis of the programs that are formulated to carry out the objectives of policy." The author's develop- ment is in the main consistent with this stated intention. The tools outlined in Part I are selected from those to which the beginning student is subjected in an elementary course in economic principles. The objectives of policy in Part II are in the main phrased in language which facilitates discussion in terms of economic logic. Finally, the analysis of programs in Part III is de- veloped primarily along economic lines.

The author's interest in narrowing his subject to more manageable pro- portions is understandable. On the other hand, the main support for the recog-

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664 AMERICAN STATISTICAL ASSOCIATION JOURNAL, SEPTEMBER 1953

nition of agricultural policy as a separate field of study would seem to come from the desirability of bringing various ideas and techniques from several related fields to bear on the subject under analysis. A textbook in the field would appear a most appropriate place to develop this kind of an integrated approach.

Considered from the narrower viewpoint of economic analysis, several re- marks seem pertinent. First, the level of analysis is quite elementary. In the preface the author indicates that the book is designed: (1) to serve readers with little previous exposure to economic theory, and (2) to serve as a basis for the development of more advanced courses in policy. With respect to the first objective, this reviewer is inclined to question whether an economic analysis of agricultural policy can be effectively handled at this elementary level. A very minimum prerequisite of one course in economic principles would seem essential. With this background several chapters included in Part I in the present form could be omitted. With regard to the second objective, one cannot escape the conclusion that this text would need to be heavily sup- plemented in an advanced course.

A second point concerns the absence of sufficient recognition of some of the limitations of the policy researcher's analytical tools. The elementary stu- dent in particular upon reading this book is likely to carry away the impression that the analytical tools are a good deal sharper than is in fact the case. This applies from both the economic and statistical points of view, but attention here is given to the latter. Economic concepts are quantitative concepts. A significant element in the analysis of various agricultural programs in- volves the estimation of relevant quantitative economic relations. The statis- tical theory of estimation of economic relations is admittedly rather involved and it would seem inappropriate to suggest that an attempt should have been made to treat it systematically in an elementary text in agricultural policy. On the other hand, the presentation of a number of estimates of co- efficients of demand elasticity as is done in Chapter 6 of this book with no caution regarding their tentative character seems equally inappropriate. If, such material is to be presented at all in an elementary book of this nature, there would seem also to be some obligation to include an elementary exposi- tion of the relevant statistical problems of estimation. A defendable alterna- tive in the present case would have been to omit this material since the book is not in the main quantitatively oriented. At the more advanced level a strong case can be made for an integrated treatment of econometric method, including the more recent development, in a textbook in agricultural policy.

Another respect in which statistical methodology deserves some attention is in connection with errors in the basic data commonly used in quantitative research in agricultural policy. Data on prices, production, employment, etc., used extensively by policy researchers, and appearing mainly in chart form in the present book, are estimates based on methods which leave a cloud of uncertainty regarding the errors of estimation. Those responsible for these estimates recognize their fallibility although no measures of error are provided as a guide to the user. The methods of estimation employed

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BOOK REVIEWS 665

depart in important respects from those dictated by sound statistical theory. It is not suggested here that the writer of a textbook in agricultural policy should be charged with the responsibility of developing measures of error. He is, however, under some obligation to recognize the presence of errors as an element in even the simplest type of quantitative analysis of the agricultural setting and of various agricultural programs. A common quantitative tech- nique in agricultural policy involves, for example, comparisons of certain aggregates or averages in different segments of the economy or different areas within agriculture. Such comparisons might serve quite appropriately to suggest frictions and maladjustments in the functioning of the system. In- comes per worker in agricultural and nonagricultural employment may serve as an example of a commonly employed comparison. Both income and em- ployment estimates are subject to statistical errors of estimation. In addition, particularly in connection with agricultural employment, conceptual or defi- nitional differences account for substantial discrepancies in current estimates available (BAE and Bureau of the Census). When various sources of error are taken into account, one wonders just how substantial a difference must be before it takes on genuine quantitative significance. In the case of in- comes per worker significant differences may well remain after allowance for statistical and conceptional errors. Other comparisons could be cited where this may or may not be the case. The point is raised not to question the aggregative comparative technique as a device for suggestive analysis but rather to suggest that in the development of agricultural policy as a field of study, proper attention to the statistical point of view would seem a con- structive innovation.

Causes of Decline in the World's Cotton Textile Trade. Osaka, Japan: Institute for Economic Research, Toyo Spinning Co., Ltd., 1952. Pp. 48.

KARL A. Fox, Bureau of Agricultural Economics

rHIs brief study was prepared for the All Japan Cotton Spinner's Associ- lation in connection with discussions at the International Cotton Confer- ence held in 1952. The foreword states that "The manuscript in Japanese has had the examination and approval of the members of the Japanese delega- tion to the Conference."

This is primarily an economic analysis. The statistical methods used are simple, and the terminology in some passages is more pretentious than de- scriptive. For example, a table dividing the total volume of world trade in cotton textiles into imports and exports by each of two major groups of countries is described as an "input-and-output relation table." A tabular comparison of changes in rayon and cotton consumption is also said to em- ploy "the input-and-output analysis." The only resemblance to input- output analysis is that the sums of row and column totals in the tables are both equal to the element in the lower right hand corner.

In some cases it is not clear what countries and time periods are used in a given analysis, nor even what method of analysis is used. On page 31, correla-

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