Equity in opportunity, participation and rewards for similar work ensure the sustainability of society. Rewards to farm­ers in NAE vary substantially as a function of land tenure. For farmers and employees in the rural economy, rewards also depend strongly on skill levels and on access to training and education. Security of employment varies widely and is critical for workers in an agricultural economy. In some parts of NAE, rewards and entitlements vary considerable according to social class, gender, ethnicity, age and formal education, often with adverse consequences for social and economic outcomes. More attention can be paid to the po­tential positive role of agriculture in promoting equal op­portunities as a basis for social inclusion and sustainable development.
•     Local, regional, national and international institutions to promote equity could be reinforced and improved;
•     Local  knowledge   and  knowledge   of  disadvantaged communities can be incorporated interactively into the AKST system; and
•     Current trends are promoting further liberalization and reform of agricultural commodity markets, increased connectivity between people and food, as well as new "markets" for services previously considered un-traded and un-priced, such as water supply and access to the countryside. Market mechanisms require information and skills of negotiation and transaction to work prop­erly. This has implications for the role of AKST in sup­porting economic efficiency and fairness.

6.2.10.2 Economic issues
In theory, economic sustainability requires that the most ef­ficient means of production and consumption of goods and services be used and overall long term net welfare (benefits less costs) maximized (Begg, 2003). Sustainability also re­quires that agents engaging in economic activity, from farm­ers to plant breeders, who commit resources now with a view to enhanced benefit in the future, are justly rewarded in terms of incomes and returns on investment, creating the enabling conditions for risk-taking. This applies whether the processes are entirely driven by market forces or interven­tions by government. Underlying this, there must be clear signals indicating what society wants of its agricultural and rural sector, whether this is in the form of market prices for agricultural commodities, or payments for environmental services such as landscape management and flood storage.
     In the past, economic growth (defined in terms of gross incomes or expenditure in the economy) was used as the dominant indicator of development. Sustainable develop­ment now requires that economic indicators be balanced with social factors associated with distributional, quality of life and ethical considerations, as well as environmental fac­tors that reflect the state of natural systems and the benefi­cial services they provide (Pearce and Barbier, 2000; Hanley et al., 2001; Tietenberg, 2003). Many of these broader soci­etal impacts are now included in so-called "extended" cost/ benefit analysis and sustainability appraisal of development options, including AKST (DEFRA, 2005b).

In this context, an economic perspective has three particular contributions to make: (1) Assessment of the economic and institutional performance of food and fiber value chains.

     A more complete understanding of the process by which value is added in food and fiber supply chains is necessary as this affects the efficiency of resource use, incentives, re­wards, technology change, the sharing of risks among sup­ply chain agents and end-user choice and welfare.
     Further developments in AKST in the following areas, could be helpful to:
•     Identify opportunities for adding value through market orientation, quality assurance, product differentiation, including the promotion of sustainable production and consumption;
•     Evaluate the life cycle performance of alternative value chains, developing appropriate data bases and analyti­cal methods (such as LCA) and decision support tools;
•     Develop tools such as multi-agent modeling to help im­prove supply chain performance;
•     Conduct value chain analysis that can help evaluate the total contribution of agriculture. This includes analysis of the competitiveness of the whole food and non-food chain and the economics of quality;
•     Justify and guide investments in supply chain and logis­tics to improve economic efficiency; and
•     Develop efficient supply chains for new products and markets, such as biofuels and medicinal crops.

Specifically, there may be significant opportunities to in­crease the competitiveness, economic viability and contri­bution to economic welfare of the forestry/wood chain:
•     Optimization of the value chain from the forest to the end product, including recycling;
•     A stronger coupling between wood producers and in­dustrial consumers;
•     Analysis of all sections of forestry-wood chain (silvicul­ture operations, sales procedures and transaction costs, harvesting and logistics costs, etc.) in order to determine how to best improve competitiveness and economic viability;
•     Diversification   of   wood   and   fiber-based   products through technological innovations: this could apply to packaging with new functionalities (embedded infor­mation technologies); advanced hygiene and healthcare products; "green chemicals"; new generation of com­posites; and
•     Development of logistic and decision support systems for optimized supply chain management.

(2) Identifying and valuing the costs and benefits of goods and services produced by agriculture. This requires valu­ation not only of marketed crop and livestock commodi­ties but also of nonmarket outputs that have consequences for economic welfare. These include the "public good" or "external benefits" (e.g., food security, diets and nutrition, watershed protection, landscape management, access to the countryside, sustenance of vulnerable human communities ) as well as the "public bad" or "external costs" (e.g., diffuse pollution, soil loss, habitat loss, displacement of people, health and safety risks) of agriculture and an understand­ing of how these are distributed spatially and over time (Costanza, 1997; Brouwer et al., 1999; Pretty et al., 2000; Hartridge and Pearce, 2001; Environment Agency, 2002; EFTEC, 2005). AKST could be developed to: