and engineering to food, fiber, and natural resources—the focus of this report. Agricultural and physical sciences alike benefit immensely from understanding-driven or basic research, targeted basic research, and mission-directed or applied research (the terms used in the Ehlers report).

In general, 20th century research in food, fiber, and natural resources has contributed substantially—in both quantitative and qualitative terms—to the stability and prosperity of the US economy and to the broader world economy. In this chapter, the committee summarizes the economic value of this research to the US economy, discusses the impact of advances in life sciences, and provides an overview of trends in public and private-sector funding of food, fiber, and natural-resources research.


The economic contributions of food, fiber, and natural-resources research are reflected in the contributions made by the food and fiber system to the growth of the US and global economies (Lipton et al., 1968; Daily et al., 1998). In 1996, US farming and its related industries accounted for $997.7 billion—13% of the gross domestic product—and employed almost 23 million people and 16.9% of the civilian workforce and 20% of the workforce residing in nonmetropolitan areas. Farming itself accounts for less than 1% of the gross domestic product and employs only about 1% of the US workforce, but it is just one link in the value-adding chain of input suppliers, capital providers, processors, transporters, service units, retailers, and others who produce and deliver food and fiber products to consumers.

The United States is the world’s leading exporter of food and fiber products, with sales of $60.4 billion in 1996. Crops from more than 30% of US farmers’ acreage are exported. USDA’s Economic Research Service estimates that each dollar earned from exported food and fiber stimulates another $1.32 of output in the United States. US food and fiber exports alone were estimated to support about 859,000 full-time jobs in 1996.

Food and fiber exports also are important in narrowing the foreign-trade gap. In 1996, the food and fiber trade surplus was $26.8 billion; the non-food-and-fiber account was in deficit by $235.1 billion. The surplus adds to the strength of the US dollar, which helps to control inflation and moderates the prices of imported goods. The nature of food and fiber exports has changed substantially from mostly bulk commodities—such as grain, feed crops, and oil crops in the 1960s and 1970s—to mostly high-value items, such as meat products, fruits, vegetables, and beer and wine. In addition to exports, 1995 sales by foreign food-manufacturing affiliates of US companies totaled another $113 billion.

The high efficiency of production and delivery of US food and fiber enables Americans to spend only about 11% of their disposable income on food—the lowest rate of expenditure in the world. In contrast, estimated rates of disposable income spent on food are 17% in Europe, 30% in South America, and 51% in India (B.Meade, USDA, personal communication, March 23,

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