Sunday, October 10, 2010

Factory Farming

Problem Context
For some time now the market share of smaller-scale farms has been on a consistent decline while the agriculture market has begun to shift to large scale farming operations (factory farms or similar Concentrated Animal Feeding Operations).  There are several factors that contribute to this continuous shift.  Some of these factors include the average cost of production per unit which favors large scale operations, and the technological advances used to standardize production in larger settings.  As a result, smaller farms are put at a competitive disadvantage and are subject to lower profitability.  Unfortunately, as the number of factory farms grows so too does the amount of agricultural pollution.  Particularly, the detrimental effects of these operations on water and air quality are cause for concern.  This increased awareness of large scale pollution has led to advocacy for small farm product consumption.  The way these large-scale operations are defying environmental ethics demands attention from both the policy makers and the citizens.

Behavior Over Time
One of the continuing trends associated with CAFOs is the use of manure lagoons to store excess waste.  Not only does this have the potential to affect water quality as a result of runoff, but air quality too is adversely affected.  For example, a typical five-acre hog waste lagoon releases 15-30 tons of ammonia into the air annually.”  http://www.epa.gov/nrmrl/pubs/600r04042/600r04042.pdf.  Excess manure nutrient production increased substantially between 1982 and 1997 with the most significant increases occurring in regions having large-scale livestock and poultry operations.  http://www.ers.usda.gov/publications/eib43/eib43.pdf.  With the market shifting toward larger operations and the decline in small scale agriculture, pollution control is becoming a bigger problem than ever before.  Policy makers have to revise previous policies to account for these new issues and make decisions about new policies that will be sustainable and effective.
Policies Now in Place or Under Consideration
In 2003, EPA introduced revised Clean Water Act regulations to protect surface waters from nutrients from concentrated animal feeding operations (CAFOs). The regulations require CAFOs to follow a nutrient management plan to minimize nitrogen and phosphorus runoff to surface water. Those plans will specify the application rate for nutrients that must be followed when applying manure to land (the primary disposal method).”  Ammonia emission programs have also been considered in order to protect air quality; these are not in widespread enforcement when compared to other policies.  http://www.ers.usda.gov/AmberWaves/September05/Features/ImprovingAirandWater.htm

Issues and Concerns with the Current Situation or Policies
Although the EPA has introduced revised regulations to control manure application, this can prove costly to farmers due to the fact that they will have to find more land to get rid of manure in order to meet these regulations.  As a result farmers turn to the use of the aforementioned uncovered manure lagoons for storage of excess manure.  This in turn increases ammonia emissions.  However, with the possible regulation of ammonia emissions, this would force the farmers to spread more manure on the lands (increasing nitrogen content) and this would defeat the purpose of water protection policies in place.  http://www.ers.usda.gov/AmberWaves/September05/Features/ImprovingAirandWater.htm

Study Purpose and Questions to be Addressed
It is the goal of this study to formulate a model describing the behavior over time that has led to the progressive emergence of pollution issues associated with factory farms.  In addition to this, it is a goal to model some of the regulatory policies in place and describe how these policies interact with each other as a result of their respective enforcement.  Questions to be answered include:  Are the policies in place effective in regulating these pollution issues?  What does the behavior of the system suggest about future agricultural pollution problems and the associated advocacy for small farm products?   


Dynamic Hypothesis

Intended Consequence

This loop represents the water quality control policy implemented by the EPA in 2003.  The intention is to reduce the amount of water pollution associated with excessive manure spreading (as a result of runoff) and is aimed specifically at regulating the large scale farming sector.  As shown in the loop, the amount of pollution associated with these large scale operations heightens water quality awareness and enforcement of manure spreading regulations.  As a result the increased effectiveness of the manure spreading policy decreases the amount of agricultural pollution.  This loop represents a balancing feedback in that the EPA is continously trying to keep excessive manure distribution in check through policy enforcement.  

Unintended Consequence

This second loop is a representation of the unintended consequence associated with the implementation of an ammonia control policy used to regulate air quality.  The air quality issue stems from the use of the formerly discussed manure lagoons.  While this policy may be helpful in regulating air quality, it forces farmers to unload these lagoons and spread more manure.  In turn, this essentially conflicts with the water control policy in place which is intended to regulate manure distribution.  As can be seen in the diagram, the amount of pollution also increases awarness regarding air quality which in turn increases enforcement of ammonia regulations.  However, as the effectiveness of this policy increases, the effectiveness of the water control policy decreases.  As a result, the amount of pollution is higher than it would have been had both policies been effective and this institutes reinforcing feedback.

Other Relevant Dynamics
This final loop (B2) represents an other relevant dynamic of the system that contributes to the amount of agricultural pollution.  Specifically, it represents the emergence of large scale farming operations which are a result of small scale farms exiting the agricultural market due to decreased profitability.  Added, it is a representation of how large scale pollution leads to advocacy of small farm product consumption in order to deter said large scale pollution.  Referring to the diagram, as pollution levels increase, so too does small farm advocacy and this has a negative effect on the market share of factory farms.  As the trend carries out, small farms become more profitable and gain more market share ultimately reducing the amount of pollution resulting from large scale operations. 

When referring to loop dominance in this system, it would seem that the policy control loops would constantly dominate as long as pollution is an issue.  However, once there was realization that the ammonia control policy was having an adverse effect on the existing water policy, the dominance of this loop would likely subside until a solution is reached.  In reference to loop B2, its level and timeframe of dominance would be dependent on the amount of agricultural pollution and associated problems at any given time. 

The model has answered the questions proposed in the study purpose.  Using the model, it is evident that the policies in place would be effective if they were implemented independently, but when enforced together overall effectiveness is decreased as they somewhat cancel each other out.  As for the second question, agricultural pollution problems associated with large scale farming operations will continue to be a problem as smaller farms are squeezed out of the market.  However, if the trend for small farm advocacy continues and there is increased consumption of their products, it looks as though large scale pollution could be decreased over time. 

On a side note, I felt that there could be delays associated with virtually every causal link in the diagram.  As opposed to littering the model with delay marks and making it more complicated I decided to let the reader infer the delays for themselves.  I'm not sure if this is the right or wrong way to approach this.




Sunday, September 19, 2010

Transaction Related Savings


This was a savings program implemented by a bank in an effort to increase the amount of transactions customers were making with their debit cards.  The incentive was that for every transaction completed with the card one dollar would be transferred from the customer's checking account to their savings account.  Although a one dollar transfer does not sound significant, some customers do not keep a substantial amount of funds in their checking.  The bank's mental model was that they could assist their customers in saving money (through the automated transfer) and use this to promote an increase in their amount of debit transactions.  The unintended consequence here was that as the amount of transactions was increasing so too was the amount of funds being transferred and this in turn led to overdraft fees. 

The mental model of the bank was flawed in the respect that it seemed to be using a narrow model boundary and was not cognizant about how this policy may interact with others in place.  It was concerned with the short-term increase in transactions (their goal) and failed to consider the possible adverse effects of the diminishing checking balance (the time delay).  Also, the interaction between this incentive program and their overdraft policy was not considered or was perhaps not given ample attention.  As the system played out over time the bank ended up actually deterring customers from making debit transactions for fear of a resulting penalty.

Friday, September 10, 2010

USPTO Patent Application Pendency

For approximately 15 years patent application pendency (the time it takes for the USPTO to process a patent application from application date to approval/denial status) at the USPTO has been increasing.  The economic disasters over the last 10 years along with other factors have been the cause of the real exponential growth in the backlog and turnaround time.  The main variable to consider when determining the evolution of this problem is the budgetary issue/lack of funding at the USPTO.  Fees imposed on patent applicants make up approximately 70 percent of the Patent Office's budget.  Along with the economical stresses on potential applicants, there has also been a significant decrease in the patent allowance percentage (those applications that are actually approved and patented) in order to increase patent quality.  These factors have applicants discouraged to invest in a patent application and in turn leads to less fees collected by the PTO for funding.  All that being said, this has led to limited hiring of patent examiners and as a result the application pendency time has increased and created a reinforcing system.  The amount of backlog has overwhelmed the limited workforce.  There are various elements, both hard and soft, included in this complex system.  The hard elements, for example, would include the amount of fees collected, the patent allowance percentage, the amount of incoming applications, the number of examiners, the backlog volume, and the amount overtime worked by examiners.  What makes this system so complex is the number of soft factors.  Some of the most significant would include the ethical reliability of management, that is, the validity of the data being presented, the future attrition of the workforce, and finally the unknown future economic trends.

Note:  The factual data included in this blog regarding the USPTO was taken from information presented on the website http://www.ipwatchdog.com/ .