FLEXIBILITY IN AGRICULTURE

This paper considers the determinants of two dimensions of flexibility, the flexibility in adjusting aggregate output over time ("tactical flexibility") as well as the ability to switch quickly between products ("operational flexibility"). Econometric analysis of a sample of 40,000 farms in Upper-Austria for the period 1980 to 1990 suggests that larger full-time farms operated by younger, better educated farm operators are more flexible, ceteris paribus. The results further indicate a significant and negative interrelationship between tactical and operational flexibility.Farm Management, Industrial Organization,

Bridging the divide: new evidence about firms and digitalisation. Bruegel Policy Contribution Issue #17 December 2019

Using new evidence on the digitalisation activities of firms in the European Union and the United States, we document a trend towards digital polarisation based on firms’ use of the latest digital technologies and their plans for future investment in digitalisation. A substantial share of firms are not implementing any state-of-the-art digital technologies and do not have plans to invest in digitalisation. However, there is also a substantial share of firms that are already partially or even fully implementing state-of-the-art digital technologies in their businesses and that plan to further increase their digitalisation investments. Small Manufacturing firms and old small firms in services are significantly more likely to be and remain non-active in terms of digitalisation. Our results do not provide any evidence that EU firms are more likely than their US counterparts to be stuck on the wrong side of the digitalisation divide. Taking into account firm size and firm age, there are no significant differences between the EU and the US in terms of having more or fewer persistently non-digital firms. As persistently digitally-inactive firms are also less likely to be innovative, to add employees or to command higher mark-ups, it is important for policymaking to remove barriers that trap these firms in persistent digital inactivity. Lack of access to finance is a major barrier for EU firms compared to their US counterparts, particularly for the EU’s persistently non-digital firms, and especially for older, smaller companies in services. Improving their access to finance might therefore go a long way towards addressing the corporate digitalisation divide in the EU

Do Cooperatives Offer High Quality Products?

The present paper investigates the free-riding problem in determining product quality within cooperatives in a vertically related market. Whereas the individual member has to bear all costs associated with higher quality, the benefits of delivering higher quality have to be shared among all members. On the basis of a Mixed-Oligopoly model, we show that the free-rider problem in the supply of high-quality products, although important for the members of the cooperative, may not be strong enough to ensure that firms will always supply higher quality than cooperatives. Whether the cooperative can overcome the free-riding problem and supply a final product of high quality is shown to depend on the consumer's valuation of quality, the costs of producing high quality, the way in which the quality of the final product is determined from the quality levels of the inputs delivered as well as on the number of members of the cooperative.Agribusiness,

Determinants and Dynamics of Farm Diversification

This paper examines the impact of various farm and household characteristics (such as farm size, the off-farm employment status, the farm operator's age and schooling and the number of family members) on the level as well as the dynamics of on-farm diversification. Using linked census data for Upper-Austria from 1980, 1985 and 1990 we provide evidence that smaller farms are more specialised and also tend to increase the degree of specialisation over time more quickly than large farms. A significantly lower degree of diversification (higher degree of specialisation) as well as a stronger reduction in diversification over time is also reported for businesses operated by older, less educated, part-time farm operators. The analysis of diversification dynamics also suggests that (a) farms adjust to changes in their environment by steadily approaching their long-run equilibrium level of diversification (b-convergence), and (b) the variance of the diversification distribution declines over time (s-convergence). --

Determinants and Dynamics of Farm Diversification

This paper examines the impact of various farm and household characteristics (such as farm size, the off-farm employment status, the farm operator's age and schooling and the number of family members) on the level as well as the dynamics of on-farm diversification. Using linked census data for Upper-Austria from 1980, 1985 and 1990 we provide evidence that smaller farms are more specialised and also tend to increase the degree of specialisation over time more quickly than large farms. A significantly lower degree of diversification (higher degree of specialisation) as well as a stronger reduction in diversification over time is also reported for businesses operated by older, less educated, part-time farm operators. The analysis of diversification dynamics also suggests that (a) farms adjust to changes in their environment by steadily approaching their long-run equilibrium level of diversification ( B-convergence), and (b) the variance of the diversification distribution declines over time ( O-convergence).Diversification, Farm Sector, Dynamics, Panel Data, Farm Management,