24 research outputs found

    Conceptualisation of family farms’ flexibility

    Get PDF
    Agricultural enterprises in transition countries face dynamic changes in the prevailing economic, legal and political conditions. The success of an enterprise depends on its ability to adjust its farming system in response to these changing conditions. To meet this challenge, flexible and adaptable production technology is required. Thus, the farm’s choice of technology is an important decision which determines its future performance. Although the concept of a firm’s flexibility is widely analysed in microeconomics literature, there is no comprehensive framework to facilitate the analysis of family farms’ flexibility, especially considering market imperfections and other obstacles associated with the transition process. In this paper we formulate the theoretical framework for flexibility analysis in order to investigate the impact of farm-specific characteristics on optimal flexibility design and to explain the differences between farms using different production technologies. In a simplified formal model, a competitive risk-averse firm producing one product is assumed to face fluctuating demand under uncertainty. By choosing the level of flexibility, the decision-maker determines the technology of the firm, expressed by the cost function. The optimal level of flexibility will be found by backward induction in the two-stage decision-making process, including ex ante technology decision and ex post output level decision. Using comparative statics and existing theoretical literature, some hypothesis about the relationship between flexibility and other firm characteristics will be formalised. Some possible model extensions that account for specific characteristics of the family farm business in transition countries, as well as future empirical analysis are discussed.flexibility, output price risk, family farms, Farm Management,

    On Flexibility in the Polish Farming Sector

    Get PDF
    This paper investigates the flexibility of the Polish farming sector during a transition period. Flexibility is considered to be a farm’s ability to change output by sustaining average costs. We argue that flexibility is a crucial factor in farmers’ competitive advantage, especially under dynamically changing environmental conditions. We propose a flexibility measure that accounts for both input and output flexibility. This measure is used to empirically investigate the magnitude and sources of flexibility in Polish family farming. We also identify the main factors that explain the proposed flexibility indices. The empirical findings reveal that Polish farms use different technologies regarding their input and output flexibility. While small and specialized farms can easily adapt their input structure, the larger and highly diversified producers adjust their output levels according to price changes. Farmers who use more capital-intensive production technologies, i.e. milk producers, are less flexible with regard to input and overall adjustments. Furthermore, access to bank credit increases a farm’s adjustment ability.Flexibility, Family Farm, Poland, Consumer/Household Economics, Production Economics, D24, Q12,

    Income Diversification of Farm Households: Relevance and Determinants in Germany

    Get PDF
    During recent years, the number of farms able to generate satisfactory income from agricultural production has continuously decreased in advanced economies. The main reasons are the implementation of the Common Agricultural Policy of 1992 and the increasing capitalization of the primary sector. The relevance of income diversification and interest in various development paths of rural households have, therefore, been renewed in political-economic debates in those countries. The aim of this study is to identify factors that determine income diversification in Germany. An econometric model has been estimated based on a comprehensive survey’s data. The results show that the main economic incentive for farm diversification is the expected income increase or resource allocation, whereas risk minimization is less relevant. Access to resources (labor, capital) is an important requirement for tapping alternative economic activities. Other significant variables include the education of the farmer as well as his experience in managing the farm. These findings are relevant for designing effective agricultural policy measures to explicitly meet the heterogeneous needs of the rural households.Income diversification, farm household, survey, Germany, Consumer/Household Economics,

    Conceptualisation of family farms’ flexibility

    No full text
    Agricultural enterprises in transition countries face dynamic changes in the prevailing economic, legal and political conditions. The success of an enterprise depends on its ability to adjust its farming system in response to these changing conditions. To meet this challenge, flexible and adaptable production technology is required. Thus, the farm’s choice of technology is an important decision which determines its future performance. Although the concept of a firm’s flexibility is widely analysed in microeconomics literature, there is no comprehensive framework to facilitate the analysis of family farms’ flexibility, especially considering market imperfections and other obstacles associated with the transition process. In this paper we formulate the theoretical framework for flexibility analysis in order to investigate the impact of farm-specific characteristics on optimal flexibility design and to explain the differences between farms using different production technologies. In a simplified formal model, a competitive risk-averse firm producing one product is assumed to face fluctuating demand under uncertainty. By choosing the level of flexibility, the decision-maker determines the technology of the firm, expressed by the cost function. The optimal level of flexibility will be found by backward induction in the two-stage decision-making process, including ex ante technology decision and ex post output level decision. Using comparative statics and existing theoretical literature, some hypothesis about the relationship between flexibility and other firm characteristics will be formalised. Some possible model extensions that account for specific characteristics of the family farm business in transition countries, as well as future empirical analysis are discussed

    MEASUREMENT AND DECOMPOSITION OF FLEXIBILITY OF MULTI-OUTPUT FIRMS

    No full text
    Flexibility can be considered as a crucial factor of competitive advantage, especially under conditions of dynamically changing environments. Based on the classical microeconomic definition of flexibility, as introduced by Stigler, and some recent concepts developed in the production economics, this article proposes a primal flexibility measure for multi-product firms. When decomposed, this measure offers useful insights into possible sources of flexibility, especially by investigating the role of both scale and scope economies. This approach provides the theoretical basis to investigate the magnitude and sources of flexibility in the Polish agricultural sector during the transition period

    Exploring within- and between-effects of the factors influencing off-farm work decisions in Switzerland

    No full text
    We examine the determinants of off-farm work in Swiss agriculture between 2003 and 2013. By differentiating between the between-farm effects and the within-farm effects, our model provides new insights into the labour allocation process as compared with standard cross-sectional or panel data models. As regards the between-farm variations, our results show that younger farm families without children and farm households with higher non-agricultural education levels of both the farmer and the partner are more involved in working activities outside the farm. However, the within-farm time effects provided a more differentiated picture: impacts of changes in most variables over time tended to be smaller, and in case of two variables show opposite directions. In addition to a negative between-effect of farm income on the allocation of off-farm labour, our results on within-farm effects suggest that an increase in farm income per annual family work unit could be compatible with a higher share of off-farm work during the analysed period

    Zur FlexibilitĂ€t landwirtschaftlicher Unternehmen: Sind die Kleinen oder die Großen flexibler?

    No full text
    FlexibilitĂ€t von Unternehmen wird vor dem Hintergrund einer sich immer schneller wandelnden Umwelt als eine wichtige Voraussetzung fĂŒr ein erfolgreiches Bestehen am Markt betrachtet. FlexibilitĂ€t kann im ökonomischen Sinne als FĂ€higkeit ProduktionsplĂ€ne ohne erhebliche Zusatzkosten an eine neue Situation anzupassen bezeichnet werden. Anhand neu entwickelter Methoden der FlexibilitĂ€tsmessung und eines umfangreichen Datensatzes wurden Ausmaß und Bestimmungsfaktoren der FlexibilitĂ€t von polnischen Landwirtschaftsbetrieben ermittelt. Es zeigt sich, dass die FlexibilitĂ€t der Produktionstechnologie mit der Betriebsausrichtung zusammenhĂ€ngt: Gemischtbetriebe nutzen flexiblere Technologien als Milchvieh- und Veredlungsbetriebe, die wiederum flexibler reagieren können als Pflanzenbaubetriebe. Ferner zeigt sich, dass kleine Betriebe ĂŒber flexiblere Produktionssysteme verfĂŒgen als große Betriebe. Dies gilt fĂŒr alle Betriebstypen. Kleine Betriebe können offensichtlich ihre ProduktionsplĂ€ne zu geringeren Zusatzkosten umstellen und sich besser an verĂ€nderte Marktbedingungen anpassen. Dies mag zur ErklĂ€rung der Persistenz kleinbetrieblicher oder auch dualer Agrarstrukturen in einigen TransformationslĂ€ndern, wie auch in Polen, beitragen
    corecore