| I got the European Commission to make a major policy
change. All by myself. There is a lot of money involved. Fruit and
vegetables are half our food consumption, and, done properly, they can
produce quarter of a supermarket’s profit. The policy change will
benefit British consumers by perhaps £1 Billion per year, and EU
consumers by perhaps £7 Billion.
The reform abolishes minimum standards, the law which makes farmers
throw away up to a third of their production because the food, though
perfectly edible, does not look right. The "crooked cucumber" is only
one of the foods that were banned. The second part is abolishing the
EC grading scheme for 26 fruits and vegetables.
When I was working on fruit and vegetable marketing, I could see
that the minimum standards were pushing up prices to consumers, and
were pushing up costs to farmers, distributors and retailers and that
it was extremely difficult to argue that they were benefiting farmers.
Certainly any benefits were tiny in relation to the inescapable costs.
I also analysed the grading system, not in relation to some ideal
bureaucratic world, but in relation to the realities of horticultural
marketing. I had talked to farmers, prepackers, wholesalers,
importers, greengrocers and supermarket chains. I worked in a food
research institute along with horticulturists and food scientists. I
did experimental marketing, including launching products in export
markets, and working on the shop floor of greengrocers and
supermarkets. I test marketed to determine quality preferences. I
developed the economics of quality in marketing.
I concluded that of all the many possible grading schemes, the EC
one was the least likely to improve the efficiency of marketing.
Our government and the EC will introduce appallingly bad policies
on no evidence whatsoever, but they will not abolish them or switch to
a better system without a very strong case indeed. I published a
series of academic articles and reports. I backed these up with
popular articles. These combined state of the art economics with hard
research on the practicalities of horticultural marketing, drawing on
my research and the research of others throughout Europe and the USA.
[ Peter Bowbrick,
“Evaluating a grading system”, Irish Journal of Agricultural
Economics and Rural Sociology. 7 117-126. 1979. Peter
Bowbrick, “Compulsory grading and the consumer”, Acta
Horticulturae. 55. 1976. Peter Bowbrick,
An Economic Appraisal of the EEC Fruit and Vegetable Grading System. Dublin. 1981. Peter Bowbrick,
“The case against minimum standards”, Journal of Agricultural Economics. 28:
113-117, May. 1977. ]
The argument was accepted immediately by the professionals. Two of
the papers I wrote became the classic readings on the economics of
grades and standards in universities around the world for the next 25
years – and a vanishingly small proportion of papers have this
distinction. There has been no peer-reviewed challenge to the methods
or conclusions since then. I was already well known in the food and
agriculture sector as one of the top few people in marketing economics
and horticultural economics.
I expected that all I had to do was put forward a very powerful
case for change, and it would happen. In fact, it took 30 years, and a
lot of my time, because I was working alone.
I have worked as an international consultant advising governments
around the world, and the UN. World Bank, EC, FAO etc. for most of the
time since I left Ireland. My job is to provoke change. I have spent
the last two days of a 10 week consultancy writing a Cabinet Paper
which was approved next day, giving all farmers a 25% price increase.
I have seen legislation passed to implement my recommendations for
major sectoral reform within six months of me submitting a report.
More often, I have been one of a series of consultants visiting over a
five or six year period, and it was our cumulative effect that
provoked the action. So why did this change take 30 years?
I immediately ran into problems. I found that ‘quality’ arouses
powerful emotions. People are so upset, hysterical even, that they
misinterpret what they read. They interpret a criticism of one
particular grading system as a denunciation of all grading, and a
criticism of one set of grade specifications as a dastardly plan to
force consumers to eat rubbish. I can understand that grading
inspectors who have spent twenty years of their lives deciding which
grade to put a cabbage in should react strongly if they are told that
they have wasted 20 years. Horticulturists who have being trying to
produce the perfect strawberry, too. But many other people including
administrators and soil scientists have strong gut feelings on what
should be done, feelings not based on fact or theory, as they have not
read either. People like this can outvote the experts when the
Ministry is determining policy. Few policy decisions arouse so many
irrational emotions.
I did my research in an Irish research institute and I was put
under strong pressure by people like this to change my results and
suppress my publications. I was allowed to publish one key document,
provided I did not mention the institute’s name, but this was after
years of delay, only after I started legal proceedings. Another paper
I could only publish after I left the institute, again after some
years’ delay – and yes, it was one of those that became a standard
reading for a quarter of a century. I refused to fake my results and
had to give up a well-paid, permanent and pensionable, research-only
job.
The supermarkets were in favour of any regulations that would make
greengrocers’ businesses more difficult, so they supported the
regulations, though they flouted them themselves – they used their
own, very different grading systems.
The British, Irish and other EEC governments resisted
the reforms, even though they were well aware of case for change from
the beginning, and new economists they recruited over the last 30
years read the economics at university. Why? They knew that the
legislation had no basis in research on consumer preferences,
horticultural marketing or economics, but had been drawn up by grading
inspectors sitting round a table in Geneva in 1949. They could see its
effects. Vast quantities of edible fruit and vegetables were being
dumped. Prices rose. Tens of thousands of people died early because
they could not afford their five portions a day. Growers went
bankrupt. Two thirds of greengrocers went out of business. 90% of
Britain’s fruit industry vanished in the way economists had predicted:
the law meant that a British grower had to dump up to a third of total
production, while growers abroad could export two thirds of production
and sell the lower qualities locally, giving them a lower cost per
unit sold.
Why did the Ministry knowingly waste £30 billion? We can only
speculate. Civil servants can ruin their careers by criticizing
current policy. Grading inspectors whose jobs depend on the
legislation may have influenced decisions. Decisions were made not on
the hard research, but on the gut reaction of horticulturists, grading
inspectors, soil scientists and administrators. The civil servants did
not have to account for the £30 billion because it did not come out of
their departmental budget, but out of our pockets. And some people
just did not care.
By 1982 it was clear that the British and Irish governments would
oppose any reform. I was then working abroad in Third World aid. I did
what I could to keep interest in quality alive.
I developed new theory, the general theory of the Economics of
Quality, Grades and Brands, to make sure that anybody working on
quality in marketing knew about my papers and had copies. I wrote a
book The Economics of Quality, Grades and Brands, which remains the
accepted general theory of quality as a marketing tool, I wrote a
thesis on the economic theory of quality. [ Peter
Bowbrick, "A Bibliography on the Economics of Quality and Grades." Peter Bowbrick,
The Economics of Quality, Grades and Brands, Routledge, London 1992.Peter Bowbrick,
Limitations of Lancaster’s theory of Consumer Demand, PhD Thesis, Henley Management College,
1994.Peter Bowbrick, “The Economics of Grades”, Oxford Agrarian Studies. 11, 65-92.
1982. Peter Bowbrick, A critique of Economic Man Theories
of Quality Economic man theories of quality. Peter Bowbrick, “Pseudo-research in marketing - the case of the price:perceived quality relationship”,
European Journal of Marketing. 14(8) 466-70. 1980. Peter
Bowbrick, “A perverse price-quality relationship”, Irish
Journal of Agricultural Economics and Rural Sociology. 6 93-94.
1976.Peter Bowbrick, “Quality theories in agricultural
economics”, Presented at EAAE Seminar Agricultural Marketing and
Consumer Behaviour, 1996. Peter Bowbrick, “Limitations of
non-behavioural approaches to the economics of quality” Conference of
International Association for Research on Economic Psychology and
the Society for the Advancement of Behavioral Economics,
Rotterdam, 1994. Peter Bowbrick, “The Misuse of Indifference
Curves in Quality Theory”, Working Paper, Henley, The Management
College, Henley on Thames. 1991. Peter Bowbrick, “The Misuse of
Hedonic Prices and Costs”, Working Paper, Henley, The Management
College, Henley on Thames. 1991. Peter Bowbrick, “Towards a
General Theory of Search”, Agricultural Economics Society Conference.
April, 1991. Peter Bowbrick, “Justifications for compulsory
minimum standards” British Food Journal, 92 (2) 23-30, 1990.Peter
Bowbrick, “Justifications for compulsory minimum standards”,
Agricultural Economics Society Conference. April. 1989. Peter
Bowbrick, “Stars and Superstars”, American Economic Review.
June. p459 vol 73 1983. Peter Bowbrick, “Evaluating a grading
system”, Irish Journal of Agricultural Economics and Rural
Sociology. 7 117-126. 1979.]
All the time I kept a close eye on research going on round the
world to ensure that everyone working in the area knew about my work.
This became easier with the development of the e-mail internet. My aim
was that my work should not be forgotten: anyone working on in this
area, anyone teaching in it, should know about it, and that their
students should know about it when they took up jobs in their
ministries of agriculture and food, or in the EC.
There was no peer-reviewed challenge to my work. Researchers took
look one look at it and decided that they had nothing to add, though
they used it in analysing other markets
Had I had a university, a research institute, the government or
trade organizations working on my side, I would have published the key
documents several years earlier, and I would have been able to keep
the issue alive. And if I was not trying a constant stream of new
theory in the intervals between highly stressful consultancy
assignments, I would have produced far more.
So the lesson is that one person can get the EC to change its
policy. It takes time though. With a bit of support from firms, trade
organizations, universities or government, one could expect to do it
in a few years.
Dr Peter Bowbrick
Peter@Bowbrick.eu 0131 556 7292
0777 274 6759 |