Part-Time Farming in Italy: Does Farm Size Really Matter?

Abstract

This paper explores the phenomenon of part-time farming, which is a typical feature in the EU and particularly in Italy, often associated with pluriactivity and small-scale farming. With the aim of improving current understanding on agricultural employment decisions, this study investigates the drivers of farm holders’ on-farm labour supply and tests for labour allocation differences based on the size of the farm. Since the definition of ‘small farm’ is arbitrary, this study explores different criteria taking into account the farm type and the utilised agricultural area. A random effects ordered probit is employed on a balanced panel for the period 2003-2009, using micro-data from the Italian Agricultural Business Survey (REA). The findings indicate significant differences in labour market responses between small and large farms, highlighting the diverse farm structures, incentives and business requirements. Pluriactivity and market integration are found to be important drivers of on-farm labour supply and are fundamental for the stabilisation of incomes of small farmers. The empirical results support the policy claim that for smaller farmers rural development policies which encourage diversification activities and support commercialisation are much more important than farm subsidies.