A/HRC/16/49 subsidized. While many efforts have been made since 2008 to reinvest in agriculture, too little attention has been paid to the differences between the various types of investment required and to understanding their impacts on the reduction of rural poverty. This has led World Bank economists to note that “underinvestment in agriculture is […] compounded by extensive misinvestment”69 with a bias towards the provision of private goods, sometimes motivated by political considerations.70 Research based on the study of 15 Latin American countries over the period 1985–2001 in which government subsidies for private goods was distinguished from expenditures in public goods indicated that, within a fixed national agriculture budget, a reallocation of 10 per cent of spending to supplying public goods increases agricultural per capita income by 5 per cent, while a 10 per cent increase in public spending on agriculture, keeping the spending composition constant, increases per capita agricultural income by only 2 per cent.71 In other words, “even without changing overall expenditures, governments can improve the economic performance of their agricultural sectors by devoting a greater share of those expenditures to social services and public goods instead of non-social subsidies.”72 Thus, while the provision or subsidization of private goods may be necessary up to a point, the opportunity costs should be carefully considered. B. Investing in knowledge 38. Agroecology is knowledge-intensive. It requires the development of both ecological literacy and decision-making skills in farmer communities. Investments in agricultural extension and agricultural research are key in this regard. While agricultural spending is among the four top contributors to increasing rural welfare, along with public spending in education, health and roads,73 agricultural research has the greatest overall impact on poverty and agricultural productivity in developing countries. Agricultural research had “the largest impact on agricultural production and second-largest impact on poverty reduction (after rural education) in China, and the second-largest impact on poverty reduction in rural India (after investment in roads).”74 Research in agroecological practices, in particular, should be prioritized, because of the considerable and largely untapped potential of such practices. Modern science combines with local knowledge in agroecological research. In Central America for instance, the coffee groves grown under high-canopy trees were improved by the identification of the optimal shade conditions, minimizing the entire pest complex and maximizing the beneficial microflora and fauna while maximizing yield and coffee quality.75 However, perhaps because such practices 69 70 71 72 73 74 75 D. Byerlee et al., “Agriculture for development: Toward a new paradigm,” Annual Review of Resource Economics, 1, 2009, pp. 15-31. World Bank, World Development Report 2008: Agriculture for Development, Washington D.C., 2007, p. 41. Ramón López and Gregmar I. Galinato, “Should governments stop subsidies to private goods? Evidence from rural Latin America,” Journal of Public Economics, 91, 2007, p. 1085. Allcott Hunt et al., “Political Institutions, Inequality, and Agricultural Growth: The Public Expenditure Connection,” World Bank Policy Research Working Paper 3902, April 2006, p. 24. S. Fan et al., “Setting priorities for public spending for agricultural and rural development in Africa,” IFPRI Policy Brief 12, April 2009, p. 2. S. Fan, “Public expenditures, growth, and poverty. Lessons from developing countries,” IFPRI Issue Brief 51, August 2008. C. Staver et al., “Designing pest suppressive multistrata perennial crop systems: shade-grown coffee in Central America,” Agroforestry Systems, 53, 2001, pp. 151–170. 17