Are the Agricultural Subsidies Based on the Farm Size Justified? Empirical Evidence from the Czech Republic
The paper aims to explore the relationship between size, production orientation, and performance in the Czech agriculture and to answer the research question as to what extent a farm size and a product orientation of farm do matter in relation to its productivity and profitability. We use data from...
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| Format: | Article |
| Language: | English |
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MDPI AG
2022-09-01
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| Series: | Agriculture |
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| Online Access: | https://www.mdpi.com/2077-0472/12/10/1574 |
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| author | Eliška Svobodová Radka Redlichová Gabriela Chmelíková Ivana Blažková |
| author_facet | Eliška Svobodová Radka Redlichová Gabriela Chmelíková Ivana Blažková |
| author_sort | Eliška Svobodová |
| collection | DOAJ |
| description | The paper aims to explore the relationship between size, production orientation, and performance in the Czech agriculture and to answer the research question as to what extent a farm size and a product orientation of farm do matter in relation to its productivity and profitability. We use data from FADN CZ database (Farm Accountancy Data Network—Czech Republic) of conventional farms oriented on fieldcrops production, milk production, other grazing livestock and mixed production, and we cover the period from 2015–2020. Pursuing an econometric approach (ANOVA and multivariate regression analysis), we test productivity and profitability differentiation among the different-sized and different production orientation companies. Finally, subsidies and their effects on different groups of companies are assessed. The findings from testing our empirical model indicate that very large farms have statistically significantly higher total factor productivity than large farms, which perform better than medium and small farms. Average productivity of large-size farms compared to small and medium farms is 1.4 times higher in terms of total factor productivity, more than two times higher in terms of agricultural land productivity, and 3.2 times higher in terms of labour productivity. The findings show that farms with field production statistically significantly outperform farms with orientation on other grazing livestock and mixed production. Different levels of productivity are translated into differentiation in the profitability. The highest profitability ratios are achieved by large farms followed by very large, medium, and small ones. The assessment of ratio of subsidies to agricultural production shows that small farms received 2.3 times higher agricultural subsidies per unit of agricultural production compared to very large farms. |
| first_indexed | 2024-03-09T20:56:17Z |
| format | Article |
| id | doaj.art-3e1da864dc4a47d190d7fd4c0111426e |
| institution | Directory Open Access Journal |
| issn | 2077-0472 |
| language | English |
| last_indexed | 2024-03-09T20:56:17Z |
| publishDate | 2022-09-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Agriculture |
| spelling | doaj.art-3e1da864dc4a47d190d7fd4c0111426e2023-11-23T22:20:32ZengMDPI AGAgriculture2077-04722022-09-011210157410.3390/agriculture12101574Are the Agricultural Subsidies Based on the Farm Size Justified? Empirical Evidence from the Czech RepublicEliška Svobodová0Radka Redlichová1Gabriela Chmelíková2Ivana Blažková3Department of Regional and Business Economics, Faculty of Regional Development and International Studies, Mendel University in Brno, 613 00 Brno, Czech RepublicDepartment of Regional and Business Economics, Faculty of Regional Development and International Studies, Mendel University in Brno, 613 00 Brno, Czech RepublicDepartment of Regional and Business Economics, Faculty of Regional Development and International Studies, Mendel University in Brno, 613 00 Brno, Czech RepublicDepartment of Regional and Business Economics, Faculty of Regional Development and International Studies, Mendel University in Brno, 613 00 Brno, Czech RepublicThe paper aims to explore the relationship between size, production orientation, and performance in the Czech agriculture and to answer the research question as to what extent a farm size and a product orientation of farm do matter in relation to its productivity and profitability. We use data from FADN CZ database (Farm Accountancy Data Network—Czech Republic) of conventional farms oriented on fieldcrops production, milk production, other grazing livestock and mixed production, and we cover the period from 2015–2020. Pursuing an econometric approach (ANOVA and multivariate regression analysis), we test productivity and profitability differentiation among the different-sized and different production orientation companies. Finally, subsidies and their effects on different groups of companies are assessed. The findings from testing our empirical model indicate that very large farms have statistically significantly higher total factor productivity than large farms, which perform better than medium and small farms. Average productivity of large-size farms compared to small and medium farms is 1.4 times higher in terms of total factor productivity, more than two times higher in terms of agricultural land productivity, and 3.2 times higher in terms of labour productivity. The findings show that farms with field production statistically significantly outperform farms with orientation on other grazing livestock and mixed production. Different levels of productivity are translated into differentiation in the profitability. The highest profitability ratios are achieved by large farms followed by very large, medium, and small ones. The assessment of ratio of subsidies to agricultural production shows that small farms received 2.3 times higher agricultural subsidies per unit of agricultural production compared to very large farms.https://www.mdpi.com/2077-0472/12/10/1574farm sizeproductivitysubsidyagricultural policythe Czech Republic |
| spellingShingle | Eliška Svobodová Radka Redlichová Gabriela Chmelíková Ivana Blažková Are the Agricultural Subsidies Based on the Farm Size Justified? Empirical Evidence from the Czech Republic Agriculture farm size productivity subsidy agricultural policy the Czech Republic |
| title | Are the Agricultural Subsidies Based on the Farm Size Justified? Empirical Evidence from the Czech Republic |
| title_full | Are the Agricultural Subsidies Based on the Farm Size Justified? Empirical Evidence from the Czech Republic |
| title_fullStr | Are the Agricultural Subsidies Based on the Farm Size Justified? Empirical Evidence from the Czech Republic |
| title_full_unstemmed | Are the Agricultural Subsidies Based on the Farm Size Justified? Empirical Evidence from the Czech Republic |
| title_short | Are the Agricultural Subsidies Based on the Farm Size Justified? Empirical Evidence from the Czech Republic |
| title_sort | are the agricultural subsidies based on the farm size justified empirical evidence from the czech republic |
| topic | farm size productivity subsidy agricultural policy the Czech Republic |
| url | https://www.mdpi.com/2077-0472/12/10/1574 |
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