Agricultural economics in Ireland has been a subject that has not integrated into the wider policy formation debate. It is time we broadened our reach or as in Denmark, we are in danger of being sidelined.

Paschal Donohoe may have left Irish politics for Washington but even as the World Bank’s managing director, he still finds time to review books for The Irish Times.

Inevitably the books concern that crucial blend of politics, economics and what’s electorally possible in a democratic society. His review last Saturday concerned a book entitled The Common Good Economy by the Italian-American Professor Mariana Mazzucato.

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As ever, Donohoe is classically balanced.

He reminds us that this is the 250th anniversary of Adam Smith’s seminal work The Wealth of Nations.

This is portrayed as a book that unequivocally argues for governments to stand back and concentrate on doing what the private sector can’t, such as providing an army for the defence of the nation and setting up a court system to administer justice.

But this is a simplistic view of Adam Smith’s work in that he specifically gives the example of dairy farmers supplying the liquid milk market in London being at risk of a cartel of buyers combining to drive producer prices down.

His commitment to free markets was dependent on real and fair competition which of course meant effective regulation.

In his review, Paschal Donohoe is much more comfortable in quoting John Maynard Keynes, who advocated a much bigger role for the state and that strategic spending to keep an economy functioning was often justified which is precisely what President Roosevelt did in the United States of America in the 1930s to get over the Great Depression.

He also argued not just for the provision of health, education and social protection systems but also a commodity price stabilisation policy. This book also develops the role of the State in fostering research and development.

Teagasc

In an agricultural context, we can point to Teagasc and its forerunner the Agricultural Research Institute, set up ironically by American money, but the Irish Government also contributes financially to industrial research and development as well as tax incentives for entrepreneurs. These are complex areas, especially when policies have to be implemented by politicians who can sleepwalk into major difficulties and want to be re-elected.

The obvious question as defence looms ever larger is how much State and EU involvement should there be in safeguarding European and Irish food production. Some countries will simply say let the market set prices and production patterns. Others will take a totally opposite view.

The scandal of the privatisation of the UK water system exemplified by the near bankruptcy of Thames Water will serve as a classic example of badly thought-out policy coupled with a near total absence of appropriate regulation.

Donohoe points out the constraints of modern political office and the volatility of voters. He doesn’t come up with any easy answers but we miss his calm, reasoned analysis in the current political maelstrom. The book, The Common Good Economy – A New Compass, is published by Allen Lane at a cost of Stg£25.