Subsistence agriculture in Central and Eastern Europe: how to break the vicious circle?

Subsistence agriculture is probably the least understood and the most neglected type of agriculture. In a globalised, market-driven world, it remains at the same time a myth and a marginal phenomenon. CONTENTS: Subsistence Agriculture in Development: Its Role in Processes of Structural Change; Franz Heidhues, Michael Brüntrup. Institutions and Technologies for Subsistence Agriculture: How to Increase Commercialization; Zvi Lerman. Policy Options to Overcome Subsistence Agriculture in the CEECs; Joachim von Braun, Daniela Lohlein. Decision Making Patterns of Subsistence Farmers in Bulgaria; Plamen Mishev, Philip Kostov. Commercialisation of Subsistence Agriculture in Transition Economies: On Imperfect Competition, Market Development and Support Policies; Ernst-August Nuppenau. Development Perspectives of Subsistence Farms in Southeastern Poland: Social Buffer Stock or Commercial Agriculture? Martin Petrick, Ewa Tyran. The Market Potential and Patterns of Contemporary Agriculture in Romania's Northwestern Plain; Csaba M. Kovács. Subsistence Farming in Bulgaria: Between Tradition and Market Requirements; Diana Kopeva, Nivelin Noev. The Significance of Subsistence Farming in Georgia as an Economic and Social Buffer; Hannah Kegel. Agrarian Reform and Subsistence Agriculture in Russia; Vladimir Yefimov. Economic Background and Development Opportunities of Individual Subsidiary Holdings in the Ukraine: Some Empirical Evidence; Andriy Nedoborovskyy. Modeling Subsistence Agriculture in Russia: Effects of Total Productivity Changes and Reduction of Marketing Margins; Peter Wehrheim, Peter Wobst --

On the nature of Bulgarian subsistence agriculture

In most countries of Central and Eastern Europe the process of transition to market economy resulted in an increasingly subsistence type of agriculture. The extent of subsistence farming varies from one country to another, but the phenomenon is universally present. The very existence, yet expansion of subsistence agriculture has been perceived as a paradox. It is sufficient to remind that it simply does not fit the definition of transition, which is viewed as a process that has to bring about the market into economy, the same market that went missing in agriculture. The latter would incline one to consider subsistence agriculture as a temporary phenomenon that will perish as transition advances. The basic textbook economic theory views subsistence agriculture as implicitly irrational and contradicting the sound economic logic and principles. This is also the prevailing opinion on the nature of subsistence agriculture in transition economies, as well as in general. This paper challenges this viewpoint and argues that subsistence agriculture is not only logical consequence from the worsened economic conditions at individual level, but it contributes to the overall market stability. Developing the argument with regard to Bulgaria, which is a country with a large share of subsistence agriculture, as an illustration, it dismisses the claims that subsistence causes waste of production resources and loss of overall welfare. Conversely, it is demonstrates that subsistence agriculture increases both production and consumption.

Institutional foundations of subsistence agriculture in transition economies

The paper considers the problem of subsistence and semi-subsistence farming in Central and Easter Europe. The latter is analysed in terms of the institutional characteristics of the transition process. The concepts of institutions and institutional change are clarified and subsistence agriculture is derived as a natural consequence from the process of economic transition. The process of shortening which gives rise to subsistence agriculture is described. It is demonstrated to have economy-wide effects, and in the domain of agriculture these effects lead the emergence of subsistence behavioural patterns. The policy implications of the proposed view of subsistence agriculture are briefly reviewed and some policy recommendations derived.

Subsistence Agriculture in Transition Economies: its Roles and Determinants

In line with recent suggestions about the potential positive effects of subsistence agriculture in fragile economies, this paper discusses and explains the effects of subsistence agriculture with emphasis on transition countries. Some micro-economic models of subsistence agriculture are reviewed and a two-stage decision model, combining risk aversion and transaction costs explanations for subsistence is put forward. The role of subsistence agriculture is addressed in terms of a static comparison to a commercial only agriculture. It is shown that, under some conditions, subsistence can play a stabilising role and have positive impacts on total agriculture. Employing the concept of a subsistence level of consumption, the paper demonstrates that these static effects can be valid in a dynamic perspective, provided additional conditions are met. Policy recommendations and a future research agenda with regard to possible agricultural commercialisation are drawn from the analysis.

Evaluating Differences in Household Subsistence Harvest Patterns between the Ambler Project and Non-Project Zones

Western Alaska is one of largest inhabited, roadless areas in North America and, indeed, the world. Access, via a new road that would transverse Gates of the Arctic National Park and Preserve (GAAR), to a mining district in a vast roadless section of northwest Alaska has been proposed. Given the potential effects of the road on nearby communities, we analyzed how communities connected to the road system compare to their unconnected counterparts. Specifically, using zero inflated negative binomial models, we analyzed subsistence harvest data to understand factors that influence subsistence production at the household level. We found substantial difference in these factors between communities near the proposed road (project zone (PZ) communities and a comparable set of road accessible communities outside the region, and were affected by household characteristics such as the gender of the head of household, number of children, and income. Total subsistence production of project zone communities was 1.8 – 2.5 times greater than that of non-project zone communities. Communities with a higher percentage of Alaska Native residents had greater per capita subsistence harvests. Higher household income levels were associated with lower subsistence harvest levels. Roads can provide access for hunters from outside the region to traditional subsistence hunting grounds used by local residents that would not be very accessible if not for the road. Our proxy for competition (number of nonlocal moose hunters) indicates that resident moose harvest amounts are inversely related to the number of hunters in a particular area. If subsistence harvest patterns for project zone communities currently off the road changed to mirror existing non-project zone harvests due to the road, the financial cost would be USD $6,900 – 10,500 per household per year (assuming an$8/lb. ‘replacement’ cost for subsistence harvests). This represents about 33% of the median household income. Taken together, our results suggest that the proposed road should be expected to substantially impact subsistence production in communities that are not currently connected to the road system. The scale of our data did not allow for the comparison of the impacts of the different proposed routes but the impacts of different routes is likely minor in relation to the presence or absence of the proposed roadFigures / Tables / Abstract/Executive Summary / Acknowledgments / Introduction / The Proposed Road and Mine / Study Area / Communities / Background / Modeling Household Harvest / Conclusions / Literature CitedYe

A Quantile Regression Analysis of the Effect of Farmers’ Attitudes and Perceptions on Market Participation

The objective of this study is to investigate the subjective determinants of farmers’ participation in output markets in five EU New Member States (NMS) characterised by large semi-subsistence sectors. It employs quantile regression to model market participation reflecting the heterogeneity amongst farmers. The study also uses the Bayesian adaptive lasso to simultaneously select important covariates and estimate the corresponding quantile regression models. The empirical results show that only two variables affect all quantiles, while their effect varies across quantiles. Some of the remaining variables affect the share of output sold at the lower quantiles (i.e. for subsistence- and semi-subsistence-oriented farmers) only, whereas other variables are only significant at the upper quantiles (i.e. for more commercially oriented farms). Advisory services, and particularly agricultural business advice, and information and advice on markets and prices can facilitate the market participation of subsistence-oriented farms

Individual Subsistence: On a Principle of Economy and Society

With this paper the author tries to clarify the terms of “public“ and “private“ with reference to the ideas of Thomas Hobbes and Johann Heinrich von Thünen. Both scientists showed that the individual's subsistence is very fundamental for a society and – therefore – the base of “public“. Additionally with reference to Polanyi's “Great Transformation“, it will be shown that the mainstream economic idea of “modern“ market economies acts strictly against the individual's subsistence. In contrast to his explanations, the protection of individual subsistence is an important part of solidarity. From that the question of shifting boundaries between “private“ and “public“ is reformulated against the background of the individual's subsistence! This paper gives reasons to think about the individual's subsistence as a neglected economic principle. Hereby it will also provide another and self-critical view from alternative economic perspective to the real question behind the shifting boundaries: Is a change in economic thinking to be expected? The insights into these problems will be especially useful in the prepartory work to discuss political activities in the light of the current economic crisis worldwide.History of Economic Thoughts; Thomas Hobbes; Johann Heinrich von Thünen; Karl Polanyi; Subsistence; Viablity; Right of Subsistence

Subsistence Agriculture in Central and Eastern Europe: Determinants and Perspectives

Subsistence agriculture in Central and Eastern Europe (CEE) has only recently gained interest from agricultural economists. Their origin, their future and even their definition is still not well elaborated. This paper tries to throw light on the issue of subsistence farming in CEE. It first discusses the theoretical and empirical background of subsistence agriculture. This part is followed by a typology of subsistence farming as found in CEE. Analysis considers several hypotheses on the cause of subsistence agriculture, among them the structure of land ownership, market imperfections and lack of alternative income sources or low opportunity costs of labour respectively. Of all these hypotheses, only the latter can be proofed empirically, which is done by a nonlinear regression analysis. The paper concludes that this gives reason to argue that rather economic problems than specific problems related to the agricultural structure in CEE determine the degree of subsistence farming. Consequently, structural and social policies rather than agricultural policies like market intervention are to be considered.Subsistence agriculture, transition, Central and Eastern Europe, Food Security and Poverty,

HIV and orientation of subsistence and commercial home gardens in rural Ghana: Crop composition, crop diversity and food security

An empirical study was conducted to explore differences and similarities in biodiversity in subsistence and commercial home gardens of HIV-positive and HIV-negative rural households in the Eastern Region of Ghana and their significance in household food security. Data were obtained through a household and home garden survey of a purposive sample of 32 HIV-positive and a random sample of 48 HIV-negative rural households and through in-depth interviews. A higher proportion of species common to all four home garden types consisted of food crops: vegetables, staples and fruits. In HIV-positive households, commercial home gardens were significantly larger, had significantly more species and individual plants, more perennial food crops and more species that were harvested all year round and evenness was lower, but there was no significant difference in species diversity compared with subsistence home gardens. Significantly, more HIV-positive and HIV-negative households with a commercial home garden consumed a staple crop cultivated in the home garden in the 24-h period prior to the survey than HIV-positive households with subsistence home gardens. Rural households with HIV that manage commercial home gardens cultivate a dual purpose home garden which supplies subsistence food and also provides cash income; such households may have better food security than households that cultivate subsistence home garden

To Be or Not to Be at the BOP: A One-North-Many-Souths Model with Subsistence and Luxury Goods

In this paper we seek to explain the causes and consequences of Northern penetration in Southern subsistence markets in order to reach the countless masses at the Bottom of the (Income) Pyramid. To this end we formulate a One-North-Many-Souths model, inspired by the Krugman (1979) North-South model. In our model, Southern countries are differentiated with respect to population size, but also the degree of internal connectedness as a proxy for the cost involved in reaching the local subsistence market. Northern subsistence goods production in Southern countries takes place under increasing returns to scale, why local production of subsistence goods takes place under constant returns to scale. Using this set-up, we show what kind of Southern countries would be penetrated first, and under which conditions this would happen. From the point of view of Northern producers, Southern countries can be divided into three classes: the broad class of partner- and non partner countries, and within the class of partner countries, the sub-classes of small and large partners. In this context, small partners are so small, that all of local subsistence production is taken over by the North, while in large countries part of subsistence consumption must still be met out of local subsistence production. The main insights coming from numerical simulations with the model are that Northern penetration on Southern markets releases (labor) resources that can then be used for producing tradable luxury goods. This has a negative terms of trade effect for the South, but a positive income effect, while, moreover, the latter effect tends to outweigh the former. In addition, small partner countries generally stand to gain more from Northern penetration than large countries, as in small partner countries relatively more resources would be released when shifting production of subsistence goods from local to Northern technologies. Using numerical simulations in which we increase the rate of imitation, we show that this leads to higher terms of trade for the South, and consequently, a higher penetration of the North in Southern countries with respect to subsistence production. The reason is that the opportunity cost of using Northern labor in Northern luxury goods production falls, and consequently more Northern labor is allocated to its alternative use of managing subsistence goods production in Southern countries. Thus we are able to "explain" the recent penetration of Northern firms in subsistence goods production in countries like India and China (which have become increasingly important as manufacturing trading partners), as the latter countries are both large in population terms as well as relatively well connected.Bottom of the Pyramid, North-South model, luxury goods, subsistence goods