Capital Formation In Agriculture Research Articles

Determinants of Capital Formation in Agriculture: A Case Study of Dimapur District of Nagaland, India

"The formation of capital through investment in agriculture helps build up the stock of capital assets and resources that enable the farmers to utilize their resources, particularly land and labour, more efficiently. The present study includes a total sample of 200 farm households consisting of marginal, small, medium, and large farmers from Dimapur District of Nagaland, selected through a three-stage stratified sampling technique for the year 2020-21. Using multiple regression technique assessed the factors that affect the capital investment at the farm level. The coefficient of determinant (R2) value reveals that the model as good fit. Many factors influence the formation of capital in agriculture, among which family income (in `), working members (in number), and cropping intensity (in %) have positive influence. Unlike popular studies, the operational holding (in acres) has shown negative influence. Further, the age and education of the head of a family show no influence. There is a pressing need for fundamental change in the strategy to raise the resources and income of the farmer and accordingly accelerate the pace of capital formation in agriculture through targeting investment in irrigation, land development, and other infrastructure development."

Determents of Capital Formation in Agriculture in the Eastern Dry Zone of Karnataka

Determents of Capital Formation in Agriculture in the Eastern Dry Zone of Karnataka

Farm Level Capital Formation in Agriculture: Pattern and Sources of Investment in Southern Karnataka

Farm level capital formation by farmers is largely for the creation of productive assets. An understanding of pattern of investment on capital assets and the source of funds for investment at farm level has greater significance in the present context from the point of view of agricultural development. With this background, the study aims at analysing the farm level agricultural investment in Southern Karnataka specifically focusing on progressive (Tumakuru) and less progressive (Ramanagara) agriculture districts with an objective understanding the pattern of investment and source of funds at farm level. The study revealed that, a lion share was accounted by investment on irrigation structures, livestock and farm machinery and implements, across all type of farms in both progressive and less progressive regions. However, magnitude of investment was different across the region. On an average, in both progressive area and less progressive area, large farmers invested greater amount on farm assets per farm followed by irrigated farmers, small farmers and rainfed farmers. In the progressive area, the irrigation development was the preferred area of investment, where as in less progressive area, it was the livestock. The small and rainfed farmers depended on borrowed funds for investing in assets. In progressive area, institution source of funds played a major role than the non- institutional source of funds and vice versa in less progressive area. On the other hand, the large and irrigated farmers, because of their resource base, made investment from their own sources.

Trend of Capital Formation in Agriculture: Hadoti Region of Rajasthan

Trend of Capital Formation in Agriculture: Hadoti Region of Rajasthan

Futuristic Private and Public Capital Requirements in Agriculture for Doubling Farmers’ Income across the States

The government's aim to double farmer's real income by 2022–23 requires estimates on the magnitude of private and public capital formation in agriculture and allied activities in the past so that the futuristic investment requirements may be worked out. This paper estimates state-wise public investment ‘in’ and ‘for’ agriculture from 1981–82 to 2013–14, based on the capital expenditure on key economic heads in Finance Accounts and private (farm household) investment for 1981–81, 1991–92, 2002–03 and 2012–13 based on NSS-AIDIS (schedule 18.2) data. The incremental capital output ratios have been calculated to determine the rate of increase in agriculture and rural infrastructural investments, which would augment, if not double farm income over the 7-year period. The analysis indicates that both private and public investments in agriculture have increased manifold. Assuming that demand for output continues and capital-use efficiency remains unchanged, an investment rate of 26.1 per cent would facilitate doubling of farm income. In absolute terms, an additional investment of 645 billion on private account and 1900 billion on public account at 2015–16 prices would be required by 2022–23, which should grow annually at 10.8 per cent and 14.7 per cent, respectively. Though it is easier for the respective state governments to meet this target, it is more important to improve the marginal efficiency of capital in irrigation, rural energy and road-transport, by investing in area-specific and domain-specific needs so as to reap maximum gains. The government must prioritize investments in the less-developed eastern and rainfed states due to higher additional returns per unit of capital compared to that in the developed states. A substantial increase in the institutional credit is recommended to cover as many farmers as possible.

Factors responsible for Defaulters of Dairy Credit: A Discriminant Approach

Credit is the most critical factor in stimulating private capital formation in agriculture. It is reported that 66.33 per cent of the private investment in agriculture was facilitated through institutional finance. Studies suggest that the incidence of overdues in the agricultural credit system had been increasing over the years there by steadily eroding the commercial viability of the system in the past though the things have altered marginally during the nineties. The study based on primary data was carried out in Karnataka, India using Multistage Random Sampling. Discriminant function analysis was used for identifying factors responsible for discriminating defaulters from non-defaulters of dairy loans. The study revealed that important discriminating factors were per capita food expenditure, percentage of earning adults in the family, per capita income from dairy, percentage expenditure to total income and capital investment in dairying. While the first four factors were positively related to the higher repayment, the later was negatively related with the repayment. Further the model was used to predict whether a borrower is likely to be a non-defaulter or defaulter. The model correctly predicted 69 per cent of defaulters and wrongly predicted 31 per cent of defaulters. Similarly model was able to predict 72 per cent of non-defaulters correctly as non-defaulters and 28 per cent wrongly as defaulters. Overall model was successful in classifying 70 per cent of the borrowers correctly. Thus model was found to be valid to predict whether an unknown borrower is likely to be defaulter, more precisely.

Temporal patterns and disparities in household fixed capital formation in agriculture: an analysis of Indian states

Among the two sources of capital formation in agriculture i.e. public and private, the latter acquires an important place as far as flow of capital funds to agriculture is concerned. Private capital formation in agriculture mainly comprises of household capital formation. The study attempts to explore the temporal trends and the extent of disparities in farm capital formation accruing from the household sector. It was found that while household capital formation grew at an impressive rate during the pre-reform period the growth sharply decelerated during the immediate post-reform period. A significant revival in growth was observed during the decade of 2000s which could be a result of the consistent efforts on the part of government to increase farmer's investment in the agricultural sector. Disparities across states with respect to level of household capital formation reduced during 1980s but increased thereafter in general and during the decade of 2000s in particular.

Role of agro-industries for sustainable agricultural development in India

Agricultural sector is the mainstay of Indian economy. Therefore, agroindustries have been given high priority in India due to their significant potential for contributing to sustainable agricultural development. An attempt has been made in the present study to have an insight into the role of agro-industries for sustainable agricultural development in India. The results revealed that gross capital formation in agriculture and allied sector as percentage of agricultural GDP has increased from 14.9 percent in 200607 to 19.8 percent in 2011–12 and agro-industries have registered a positive growth in terms of capital invested. The results further revealed that the performance of food processing sector has improved substantially as it has been growing at an Average Annual Growth Rate (AAGR) of around 6 percent as compared to around 4 percent in agriculture. While comparing the share of agriculture and allied sector in total gross state domestic product, Arunachal Pradesh has shown maximum share (43.87 percent) followed by Punjab (28.92 percent) and Uttar Pradesh (28.23 percent) in the year 2012–13. So, there was a wide variation in the performance of different states.

Complementarity Between Public and Private Capital Formation in Agriculture

Complementarity Between Public and Private Capital Formation in Agriculture

Capital Formation and Agricultural Growth in China

The paper considers the role and determinants of capital formation in Chinese agriculture and, in particular, the effects of capital formation on agricultural total factor productivity (TFP) growth. The results show that capital investment in agriculture by both government and farmers has risen significantly in the past two and a half decades, particularly in recent years. As China remains in the early stages of agricultural policy transition, its political economy would suggest that there will likely be more public investment in, and more subsidies to, agriculture in the coming years. Increased public investment in agriculture appears to have also induced increased farmers' capital formation in agriculture. Credit policy, the overall growth of farmer's income, rural wages, and comparative advantage of commodities are important factors that may facilitate farmers' investment in agriculture. The results also show that the successful growth of China's agriculture has been associated with its high TFP growth. Both public and private agricultural capital formations have played an important role in raising China's agricultural productivity. The TFP decomposition analyses show that technological change is a primary driver of the TFP growth in China's agriculture.

Impact of capital formation on production and export: A case of agriculture sector in India

This study empirically examines the impact of capital formation in agriculture and allied sector on production and exports of agriculture sector in India. The study runs from 2004 through 2010. The study employed two and Multi- variables regression analysis model specified on the basic of hypothesized functional relationship between capital formation as the explanatory variables, while Agriculture Production and Agricultural Exports constituted the explained variable. The model for the study was estimated using the ordinary least square (OLS) technique. The result shows that capital formation in agriculture and allied sector has statistically significant impact on the agricultural production and agricultural exports of the economy in the period of reviewed.

A review of methodological issues relating to the estimation of terms of trade and trends in terms of trade between agricultural and non-agricultural sectors of the Indian economy since 1950’S

The movements of intersectoral terms of trade (TOT) in India since independence is characterized by periodical shifts in favor and against agriculture. The intersectoral terms of trade has been favorable during 1967- 1968 to 1977-1978 and during the post reforms period. But the indicators of performance and growth of the sector has been showing unimpressive trends in the post reforms period. While considering the slow pace of reforms in the country, it is also observed that policy changes in agriculture were still slower. This paper analyses the impacts of the swings in terms of trade (favorable and unfavorable to agriculture) on the performance of agricultural sector in the country. It was revealed that while the favorable swing in terms of trade has caused increased private gross fixed capital formation in agriculture, it has not led to any perceptible improvement in agricultural production or growth rate of agriculture gross domestic product (GDP). While the favorable TOT during 1967-68 to 1977-78 is speculated to be the result of government price support mechanism, this paper argues that the favorable TOT in the post reforms period is a result of decline in the aggregate crop output rather than government policies. Key words: Terms of trade (TOT), agricultural growth rate, gross domestic product (GDP), government policies.

An Analysis of Status and Trends of Investment Credit in Indian Agriculture

Reasonable level of investment in agriculture sector is essential for capital formation to generate growth. Gross Capital formation in agriculture declined from 10.2 per cent of GDP in 1999-2000 to...

Capital Formation in Indian Agriculture: A Review

This paper looks at the trends in investment behaviour in Indian agriculture with particular reference to the relationship between private capital formation and public capital formation. It also looks at inter-sectoral terms of trade. Determinants and reasons for the decline of Public capital formation, efficiency of capital use, and the demand for public capital formation in agriculture in the present Indian context. The declining trend of gross fixed capital formation in the eighties was reversed in the nineties mainly due to a good increase in private capital formation despite some decline in public capital formation. The complemantarity between public and private capital formation in agriculture still holds good at the all-India level, as well as, in states, though there seems to have occured some weakening of the inducement effect at the all-India level. Due to differences in composition, private capital cannot substitute public capital in agriculture. The impact of terms of trode on private capital formation increased over time. The efficiency of capital use declined during the nineties. There is higher demand for public capital formation in the present Indian context. The failure of the favouruble terms of trade to improve agricaltural production. productivity and thereby employment, the need for improving dry land agriculture and increased needs for research, extension and infrastructure development efforts in the liberalised trade regime; make non-price interventions with higher public investment an urgent need.

Trends in Capital Formation in Agriculture - A Case of Arid India

Trends in Capital Formation in Agriculture - A Case of Arid India

Capital Formation in Egyptian Industry and Agriculture, 1882-1967.

Current interest in the measurement of capital stems from its importance as a symptom and a cause of economic growth. For this purpose capital is understood in the real sense, and we are interested in it as a factor of production and the contribution it makes to output. Lack of quantitative enquiries into the historical pattern of Egypt's economic growth in general, and long-term estimates of capital formation in particular, account for the fact that the role played by real capital in the process of growth is quite uncertain and not very well understood. It is the primary objective of this study, therefore, to draw on available statistics in order to measure gross and net fixed capital formation and capital stock in Egyptian agriculture and industry, at current and constant (1960) prices, covering the period 1882-1967. The estimation procedure involved the application in the first place of the commodity-flow approach, and wherever data were available, the expenditure approach was also followed. The emphasis is almost exclusively on one aspect of capital formation; yearly capital accumulation in terms of additions to fixed capital stock. Consequently, little attention is given here to both the sources of investment funds and the determinants of investment decisions, An attempt is also made in this study to describe the long-term trends in the rate and structure of capital accumulation and to outline the broad economic, institutional and historical factors affecting the rate and pattern of growth of capital formation in agriculture and industry. Moreover, the two sectors are discussed together in order to compare their performance and contrast the types of structural change that took place. Finally, the study concludes by some speculation on the general pattern of growth of the Egyptian economy as a whole.

Farm Finance and National Economic Policy—Some Gaps in Knowledge

port on the status of knowledge to the profession. Emanuel Melichar, with the Board of Governors of the Federal Reserve System, and this paper's author are involved in a review of agricultural finance literature. This paper builds on materials that have been reviewed. This paper does not fully treat the broad subject of farm finance as related to national economic policy. Omitted are issues of taxation, price stabilization, loan guarantees, business cycle relationships to agricultural credit markets, differential effects of inflation on agriculture and other sectors, and others. Although such issues merit further research and discussion, the purpose here is to focus on a relatively few important topics, to review research on those issues, and to suggest gaps in knowledge. The basic assertion made in this paper is that agricultural finance research is too heavily oriented toward micro economics and not sufficiently concerned with national economic policies. While micro economics is important and should receive reasonable emphasis, it is also true that national economic policies affect capital formation in agriculture, functioning of financial markets in rural areas, and the flows of funds between agriculture and other sectors. To the extent this assertion is valid, it is, perhaps, largely because of agricultural economists' training in economic theory. Undoubtedly most agricultural economists have received more exposure in micro theory than in macro theory. Another possible reason for this micro orientation is that micro theory suggests more easily tested hypotheses than macro theory. There is, perhaps, danger in overemphasizing the importance of economic theory with respect to research results. However, this position stems from the methodological importance of theory in specifying the main economic relationships of relevance in research. Economic theory provides the basis for delineating hypotheses to be tested and specifying the relationships to be measured. In many cases gaps in our knowledge of agricultural finance issues stem directly from gaps in he underlying economic theory. The four topic areas discussed here are: (1) capital formation in agriculture as affected by national economic policy; (2) the effect of national monetary and credit policies on investment and production in agriculture; (3) functioning of rural financial markets; and (4) the sources and uses of funds approach in the analysis of agricultural financing.

Landlord's Capital Formation in East Anglia, 1750–1870

T tHE installation and maintenance of the landlord's capital in agriculture provide us with the readiest access to the complex problem of agricultural capital formation in Britain at any period. There inevitably remains some material evidence of changes in the tangible fixed equipment of farmingbuildings, drains, roads, or fences, which together make up the landlord's capital-if only as archaeological survivals; although not enough research has yet been undertaken on the dating and construction of farmyards and buildings, other than houses, in Britain, except in some regions where farmsteads were replanned and rebuilt after enclosure.2 The chief source of detailed, reliable information, however, is the estate rentals and accounts from particular periods to be found in record offices all over Britain, which illustrate this aspect of capital formation in agriculture as no other evidence can. Some idea of the difficulties involved in such an inquiry may be obtained from reading recent writers on the subject. After a century of more or less elaborate agricultural statistics, the evidence of capital investment in, and the durability of, tangible equipment such as farm buildings or drains is still very deficient.3 This article is intended as a pilot study, consisting largely of an inquiry into such expenditure upon repairs and improvements to the fixed equipment of farms as can be found in the estate records of a particular region, East Anglia. It illustrates all too clearly the limitations of such an analysis for historical research, but the writer hopes it will provide a basis for discussion, especially since it throws into relief the most important problems involved.

SOME REFLECTIONS ON AGRICULTURAL INVESTMENT*

In this paper I propose to review briefly some of the more significant points which seem to be emerging from recent studies of capital formation in agriculture.