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The department began producing formal reports of research activities in 1995/96 in conjunction with the establishment of the Cotton Economics Research Program; reports on Cotton Economics Research have been done annually since then. As our research programs expanded and diversified, we initiated a separate Departmental Research Report in 1998/99. With this annual report we are combining all research reporting into the single report, with more compartmentalization of research programs. This report highlights research activities in the Department of Agricultural and Applied Economics during fiscal year 2003/04. The overall program has been characterized by its flexibility in addressing varied issues of economic significance and is applied in nature, although there are some other disciplinary elements within it. We are allocating approximately 46% of its full-time faculty resources to research (about 6 FTE on a 12-month basis), including our 48% research appointment with the Texas Agricultural Experiment Station. Research projects in the department cover a range of subject matter areas: production economics (including finance and risk management), market economies, natural resource (including environmental) economics, international economics, economic policy analysis, and consumer economics. Fiscal year 2003/04 was another productive research year for the Department of Agricultural and Applied Economics. Overall, 32 different research projects were active during the year. Appendix A contains the individual annual reports of each active research project. While we are increasing our level of research activity in cotton economics, an increasing proportion of the research is in other subject-matter areas. The research program is becoming more diverse as per our strategic plan. Also, the program continues to become relatively more nationally and internationally focused, as opposed to state focused. These changes are occurring in part because of our relatively greater federal funding compared to state funding. Total funding secured by faculty in the Department for the research projects during fiscal year 2004/04 was $1,608,000 (Table 1). More details on research funding in 2003/04 are provided in Appendix B. The specifics with respect to the funding generated under the different projects is outlined in the individual projects' annual reports. Of the $1.6 million generated, 16% came from State funding sources, 78% came from Federal funding sources, and 6% came from Private funding sources. It is important to point out that of the $256,145 coming from State funding sources, approximately 62% ($159,453) came to the Department under the Applied Economics Research Fund (a combination of the former Cotton Economics Research Special item and a portion of the former CASNR Plant Stress funding). From the total internal funding base, the faculty generated $6.58 of external funding for each $1.00 of departmental funding. The total amount of research funding generated by the faculty in fiscal year 2003/04 was the highest level in the history of the Department (Table 1). In the last five years, total research funding increased by 156%; the largest increase has been in federal funding (896% increase).


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