Economic Size Of Farms Research Articles

Factors differentiating the level of crop insurance at Polish farms

PurposeThe purpose of this paper is to identify the factors that determine demand for crop insurance in Poland.Design/methodology/approachTo examine the determinants of decisions regarding crop insurance, the authors used logistic regression. The base source of data for the analysis was the 2013 FADN sample. The scale of yield losses, the indemnities received and the Arrow-Pratt risk aversion coefficient were examined in a representative sample of farms in consecutive years in the period 2004-2013.FindingsLosses are the major determinants of crop insurance uptake. Additionally, it was observed that the economic determinants are in line with the expected utility theory, while contrary to expectations, farmer’s characteristics such as education level, age or even risk aversion did not prove to have any influence on crop insurance uptake.Research limitations/implicationsThe FADN sample is representative as regards the type of farming, economic size of farm and location of the farm. Every farm in the sample represents a specific number of similar farms in the population. However, it must be emphasised that the representativeness of the sample with respect to other determinants, e.g., yield losses in previous years, using crop insurance or the farmers’ age and education has not been verified due to lack of data characterizing the general population with regard to these factors.Practical implicationsIt could be argued that the system of crop insurance subsidies should be targeted to encourage the farmers who previously had not used insurance to join the system.Originality/valueThe paper presents the analysis of crop insurance uptake in a country with a strongly polarised agriculture. The Polish farm sector consists of 1.4 million farms with sizes ranging from 1 ha to over a few thousands hectares. The research is based on a data set of 5,202 farms which contains data from ten years (2004-2013). The novelty of the methodological approach is that it includes information on the number of farms represented by every farm in the FADN sample in the Horvitz-Thompson estimator in order to achieve results which are valid for the general population of Polish farms.

EFFICIENCY OF AGRICULTURAL FARMS IN POLAND IN 2012-2015 DEPENDING ON THEIR ECONOMIC SIZE

The article assesses the level of effectiveness of farms in Poland depending on the economic size. The analysis included agricultural farms participating in the Polish FADN. The study period covered the years 2012-2015. It was found that with the increase in economic size of farms increased productivity of land, labor and capital and labor productivity. In the case of land profitability, return on assets and return on equity growing trend appeared to economic size SO 500 thousand euros, while the above indicators were analyzed on a much lower level. In addition, during the period considered, there was a decrease in the efficiency of agricultural farms in Poland, which is unfavorable.

INVESTMENT DIFFERENTIATION IN FARMS BELONGING TO MAZOWSZE AND PODLASIE FADN REGION IN THE YEARS 2010-2014

The paper presents the diversity of investments in agricultural holdings belonging to FADN region of Mazowsze and Podlasie in the 2010-2014. To carry out the study the gross and net investment (FADN SE516 and SE521 variable) and the investment subsidies (SE406 variable) were used. The research shows that farms in FADN Mazowsze and Podlasie region have been intensively investing. Their value, however, varied depending on the type of farm and economic size. Field crops (cereals, oilseed and seed crops) reached the highest level of investment in 2010-2014. At the same time, research has confirmed that the economic size of farms directly affects the level of investment in these holdings (higher economic size - higher level of investment).

Identification of small agricultural producers: European experience for Ukraine

One of the areas of improvement of state agrarian policy in Ukraine is increasing support for small farms. However, there is still no common position on the division of agricultural producers by economic size. For identifying it, it seems appropriate to take into account the practice of the European Union, where the typology of farms uses the indicator of economic size. It is based on the economic parameter of Standard Output (SO) and describes the possible value of production that the producer is able to get, with the available productive capacity and conducting business in a particular region. The economic size of farms is determined based on their acreage and number of animals using regional SO ratios, which are calculated in the EU by relevant authorities. The farms are classified by economic size in 14 classes ranging from less than 2 thousand Euros to more than 3 mln Euros. Within the system, there are groups of small, medium and large farms. Ukraine needs to adopt the European approach to assessing the size of the farms, in which the group of small sized farms would include individual farms (households), peasant family farms and small sized economically independent farms. It is necessary to immediately start to build a national system of determination of farm size in terms of the economic parameter of Standard Output. During the transition period, it is expedient to temporarily assess the economic value of farms using an indicator as close as possible to the SO.

Economic size of farms and adjustments of the total factor productivity to the business cycle in Polish agriculture

The article presents an approach to changes in the total factor productivity (TFP) which differs from that generally found in the literature. Changes are calculated in the real terms using the detailed input-output matrices for representative farms in Poland, for different economic size classes, in the years 2007–2013. Input-output matrices were used for the decomposition of the Hicks-Moorsteen TFP index. The goal is to evaluate changes in the real TFP in the downturn and recovery phases of the business cycle in agriculture. It was found that the reaction of TFP to business cycle changes on “small”, “medium” and even “large” family farms in Poland is diametrically opposite to that observed in the case of large-scale farms. More than 90% of farms in Poland (except for the largest) increase technical productivity in the conditions of the economic downturn and lower it in the conditions of the economic recovery. Such behaviour is pro-cyclic and irrational, alluding to the 17th-century King’s effect, which is vanishing in the agricultural systems of highly developed countries. The hypothesis is proposed that the size of the price expectation error which causes that effect is negatively correlated with the economic size of the farm, but at the same time it is proportional to the percentage of agricultural income obtained from subsidies and other payments under the SAPS system.

ECONOMIC ASPECTS OF THE IMPLEMENTATION OF THE RURAL DEVELOPMENT PROGRAMME 2014-2020. REMINISCENCES AND PROJECTION

The second pillar of the Common Agricultural Policy is an important element of support for Polish rural areas, due to the need to improve the competitiveness of agricultural producers, to transform the employment structure, to boost infrastructure development and to implement tasks related to the protection of the environment. Thus, the size of the funds of the Rural Development Programme (RDP) for 2014–2020 and their allocation to different tasks is essential for the future of rural areas. The aim of the article was to evaluate the RDP for 2014–2020 from the point of view of the potential economic consequences of its implementation. This rating was made in two areas: the budget, and the construction of selected activities. Data on the budget and the allocation of funds in the new financial period indicate that the RDP limits expenditures on some of the objectives, primarily related to infrastructure and entrepreneurship. The priority actions are, however, pro-investment and modernization, and improving the position of farmers in the food chain. There are also programs of a social nature, aimed at small farms and activities with low added value (e.g. less favored areas, or LFA). Reducing the budget of the RDP forced implementation of some solutions, e.g. degressive payments and limits on the area and economic size of farms; thereby both the smallest and larger farms could be excluded from part of the support

Participation rate of farmers in different multifunctional activities in the Netherlands

In this article, we present the findings from a study into the relationships between socio demographic, economic, and geographical characteristics of farm holdings and their participation rate in multifunctional activities. Recreation, nature management, care, and education services are most widespread among dairy farms. Farm holders of arable and dairy farms with extended activities are younger and the economic size of their enterprises is larger than that of conventional enterprises. For horticultural and intensive husbandry farmers, there were no age differences and, unlike the land-based types of holdings, the economic size of farms with extended activities was smaller than that of conventional farms. While care and education are more widespread in urbanized areas, the opposite was found for nature management. Proximity to sea has a positive impact on the participation rate in recreation, on-farm selling, and nature management. In order to understand the decisions of farmers, it is crucial to take the type of multifunctional activity, type of agricultural holding, and location into consideration.

Poslovni i proizvodni rezultati razlicitih tipova poljoprivrednih gospodarstava

Farm Accountancy Data Network (FADN) was established in the EU in 1965 and now it is obligated for all member states of the EU. The system is based on an annual collection of production, economic and financial data from a representative sample of comercial farms, classified into groups according to the criteria of economic farm size, type of agricultural production and regional affiliation. Research made by FADN system represent the European Commission instrument for evaluating the income of agricultural producers and determining the impact of the Common Agricultural Policy of the EU on their business. In this paper the comparison is made between production and economic indicators of different types of agricultural holdings (field crops; horticulture crops; permanent crops, orchards and olive yards; dairy farms; grazing livestock; pig and poultry farms and mixed farms). On the basis of Standard Results for the year 2014 it is possible to conclude that in Croatia field crops and grazing livestock farms lead by their utilized agricultural area. Pig and poultry farming have the most livestock units, while the most working hours is spent in the cultivation of vegetables and flowers. The highest values of labor productivity have holdings that are engaged in the production of vegetables and flowers, while the lowest labor productivity have grazing livestock farms. Cost-effectiveness of all types of farms exceeding a value of 1. The highest value of the gross income is achieved at pig and poultry farms, while the smallest has a mixed type of farms. The average farm direct payments account for a high 44% in the net income, and the largest share of direct payments in the net income has field crop type of farms.

POTENCJAŁ EKONOMICZNY DOLNOŚLĄSKICH GOSPODARSTW ROLNYCH UCZESTNICZĄCYCH W REALIZACJI PROGRAMU ROLNOŚRODOWISKOWEGO

The aim of the study was to include determine the economic potential of the farms from Lower Silesia participating in the implementation of agri-environmental program. The results were presented in respect of the land area as well as farms that were not beneficiaries of agri-environmental program (action Axis II: Improving the environment and rural areas Rural Development Programme RDP 2007-2013). The economic potential is determined by a number of parameters that are often difficult to measure. In the research process were taken into account the following parameters characterizing the studied subjects: economic size of farms, farm area, the value of equity holdings (the value of total assets at 1 ha).

Zróżnicowanie produkcji mleka w regionach Unii Europejskiej w latach 2007-2011

The purpose of the considerations was to identify similarities and differences between dairy farms from different regions of the European Union in 2009. The diversity of dairy farms in the regions of theEuropean Union was determined by agglomerated cluster analysis using Ward's method. The research was based on FADN data. It analyzed the economic size of farms (ESU classification), total utilised agricultural area, the number of dairy cows and the average annual milk yield. On this basis the typology of EU regions has been made. As a result of clustering five homogeneous cluster regions have been obtained. A comparison of production and economic indicators in each group of regions has been made to determine the similarities and differences between the clusters.

Czy gospodarstwa specjalizujące się w uprawach polowych i produkcji wielokierunkowej poprawiają produktywność w tym samym stopniu?

In this paper we attempted to address the question presented in the title based on the data contained in the Farm Accounting Data Network (FADN). Analyses covered the first six years following the extension of the European Union in 2004. Estimation of the Malmquist total factor productivity (TFP) and its components was conducted using data envelopment analysis, separately for crop and mixed farms of EU (2004-2009) taking into consideration their economic size. The analysis showed, in general, that for farms from the “old” regions the total factor productivity increased with an increase in the economic size of farms, while for farms from the “new” regions, just the opposite, the increase in the size of farms caused a decrease of productivity. As to differences in types of farming, the biggest improvement was observed in the technical and technological aspects. Finally, the estimated Malmquist total factor productivity index, although close to one, nevertheless indicates a slight progress for farms from “old” regions and, just the opposite, a slight regress for those from “new” regions.

The Relationship between Farm Succession and Farm Assets on Belgian Farms

AbstractA major bottleneck in the farm life cycle is intergenerational farm transfer. At the end of the farm life cycle only a limited number of family farms is transferred to the next generation. The average economic farm size increases and this can entail a high financial burden for the successor. This article explores total farm assets as a potential tool to identify farms with a higher probability of transfer. The theory of asset fixity and transaction cost theory are used to explain why higher total farm assets should result in a higher intention to transfer the farm to the next generation, independent of farm type. Empirical results support this theory and show that lower total farm assets often result in farm discontinuation because the total farm value approaches the value of liquidation. Furthermore, our results show that farmers anticipate farm succession possibilities by adapting their farm management. The proposed indicator could therefore be a useful tool for targeting succession or retirement policies.