Dr. Tongzhe Li is the inaugural Arrell Family Chair in Behavioural and Experimental Economics.
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The $1 million, five-year research chair position represents an emerging field at the University of Guelph focused on making agri-food production in Canada more efficient and sustainable.
The funding is provided by the Arrell Family Foundation. In a new release, Managing Director Laura Arrell said Li’s innovative research “strives to better understand and unpack the black box of economic decision-making, particularly pertaining to activities in the agri-food-environmental domain.”
Why it matters: The research position will allow further study on the connections between economic theory and human behaviour within food production.
Li said in the release she wants to “couple human behaviour with natural sciences.” Her field and lab research couple economic theory with unpredictable and sometimes messy aspects of human behaviour.
The funding will support students and seed projects and hire a lab manager for the rapidly expanding department of Food, Agricultural and Resource Economics research laboratory (FARE Lab), where Li is a professor.
“I envision the FARE Lab being a leading research team in Canada and internationally in using experimental economics techniques to inform evidence-based policymaking and to provide actionable solutions for practitioners,” said Li.
Arrell Food Institute director Evan Fraser told Farmtario Li’s expertise and in-depth knowledge of economics, producer, and consumer behaviour would complement AFI projects.
“The insights, connections, and research from this area are incredibly important to creating more resilient and sustainable food systems for the future,” he said.
“What are the things that could help facilitate a pathway to, say, absorbing greenhouse gas emissions or adopting practices that provide a wide range of social and environmental benefits as well as being economically viable?” Fraser explained. “It’s unpacking that black box in a respectful, rational, scientifically rigorous way that Tongzhe is leading.”
The current food system’s bedrock assumption is that three conditions – trade, energy prices, and weather – function well. However, it’s becoming clear that weather isn’t as cooperative, and fluctuating energy prices and long-distance trade challenge environmental and economic factors.
“(Li) is trying to figure out what the new system could look like,” said Fraser. “You have to articulate what the desired end state for this new 21st century is, and how do we create pathways to get there, which means incentives to farmers and the right supports and policy environment and technology.”
With sufficient research, including the field of behavioural economics, Canada can build its agri-food independence and move away from being utterly dependent on a tiny, drought-ridden part of a foreign country for fruits and vegetables like it is today, said Fraser.
“As an experimental economist, you never make claims without real-world evidence gained from rigorous research,” said Li, adding the key to updating conventional supply and demand economic theory is to include actual, contemporary decision-making in the equations.
Jo-Ann McArthur, Nourish Food Marketing president, told Farmtario she’s excited to see what Dr. Li’s research will reveal.
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“It’s important work. I think it will help advise the government on what they need to build and whether it is an incentive versus a disincentive,” McArthur said. “The carbon tax is a disincentive; it’s a stick rather than a carrot. But how do you bridge that gap for a farmer?”
McArthur said that farmers gamble yearly on weather, yields, markets, and inputs and bear the financial cost, and Dr. Li’s research could guide the government into program development that bridges the intention-action gap.
