CHANGES IN THE HORTICULTURE SECTOR IN THE NETHERLANDS

Abstract

The goal of this study is to analyse and to investigate the investment dynamics in Dutch glasshouse horticulture, and to reveal the factors underlying the changes in this sector. Insight into the effect of different factors on the investment behaviour in Dutch horticulture is socially relevant because this sector has to undergo structural changes. The Dutch glasshouse industry has to improve its environmental performance (reduce its energy use, pesticides, use and CO2 emissions). Improvement of the environmental performance can be achieved by investments in new technologies (e.g. energy saving technologies). Insights into factors that determine investment patterns are important in designing policies that aim at enhancing the environmental performance of horticulture. Also, insights into factors that affect investment patterns in the glasshouse industry are relevant for assessing future credit demand of the glasshouse industry by banks. Panel data from the Farm Accountancy Data Network (FADN) were used to describe the dynamics of the investments during 1975-1998. Inspection of investment patterns of firms demonstrates that investments are not spread over a number of years. Rather, investments are concentrated in some years, followed by some years without any significant investment activity. Another feature from inspection of data is that investment patterns differ between capital goods (e.g. machines, installations, buildings) and between sectors (vegetable, cut-flower, pot-plant). A factor analysis was used to explore the structure of the interrelationships among variables.