Is current system of direct payments suitable for farmers in Slovakia?

Authors

  • Jana Kozáková Slovak University of Agriculture, Faculty of Economics and Management, Department of Management, Tr. A. Hlinku 2, 949 76 Nitra
  • Mária Urbánová Slovak University of Agriculture, Faculty of Economics and Management, Department of Economics, Tr. A. Hlinku 2, 949 76 Nitra

DOI:

https://doi.org/10.5219/941

Keywords:

utilized agricultural area, total output, subsidies, Slovakia, farm efficiency

Abstract

Current system of direct payments in Slovakia can be described as per hectare payment. It is based on the logical assumption that the more land farmers cultivates, the more support they need. However, it seems like this principle works differently among EU member states. Historically, Slovakia is a country with the largest farms in EU 28. This extreme big physical farm size is here connected with the lowest output among EU 28 and simultaneously Slovak farms display also lowest efficiency. Paper examine generally accepted assumption that the more hectares farms utilize, the more subsidies they should receive, to help achieve more output. Research is based on the mutual pair combined correlation analysis, which examined relationship between utilized agricultural area, total output and total subsidies. Surprisingly just the relationship between total subsidies and total output was proved to be positive and in a moderate manner. Relation of total subsidies and utilised agricultural area, respectively total output and utilised agricultural area show the inverse relationship. In spite of the development in most European countries, Slovak outcomes indicates that the more subsidies farmers receive, the less output they achieve. This paradox can be caused by the actual Common Agricultural Policy system of subsidies remuneration which is not necessary suitable for whole EU 28 on the same level.

 

Downloads

Download data is not yet available.

References

Adamisin, P., Kotulic, R. Kravcakova Vozarova, I., Vavrek, R. 2015. Natural climatic conditions as a determinant of productivity and economic efficiency of agricultural entities. Agricultural Economics - Czech, vol. 61, no. 6, p. 265-274.

Bakshoodeh, M., Thomson, K. J. 2001. Input and output technical efficiencies of wheat production in Kerman, Iran. Agricultural Economics, vol. 24, no. 3, p. 307-313. https://doi.org/10.1111/j.1574-0862.2001.tb00032.x

Blomquist, J., Nordin, M. 2017. Do the CAP subsidies increase employment in Sweden? Estimating the effects of government transfers using an exogenous change in the CAP. Regional Science and Urban Economics, vol. 63, p. 13-24. https://doi.org/10.1016/j.regsciurbeco.2016.12.001

Ciaian, P. 2012. Productivity and farm size. Selective presentation in Slovak Agricultural University in Nitra. Nitra : Slovak Agricultural University.

Duricová, I. 2016. Government of the Slovak Republic for the Monitoring of Agrarian Policies of the Member States of the OECD 2015 [online] s.a [cit. 2018-05-29] Available at: http://www.vuepp.sk/dokumenty/oecd/oecd2015.pdf.

European Commision. 2014. Direct payments for agriculture. Agriculture. EC, 2014 [online] s.a [cit. 2018-05-29] Available at: http://www.sppk.sk/clanok/239.

Eurostat, 2018. Utilised agricultural area by categories. Dataset details [online] s.a [cit. 2018-05-29] Available at: http://www.sppk.sk/clanok/239.

FADN. 2018. Farm Accountancy Data Network. Data Collection from Agricultural Holdings [online] s.a [cit. 2018-05-29] Available at: http://ec.europa.eu/agriculture/rica/collect_en.cfm.

Gordon, M., Davodora, S. 2004. Farm productivity and efficiency in the CEE applicant countries: a synthesis of results. Agricultural Economics of Agricultural Economists, vol. 30, no. 1, p. 1-16. https://doi.org/10.1111/j.1574-0862.2004.tb00172.x

Jankacká, K., Lincényi, M. 2013. Development of economic indicators of agricultural holdings. Ekonomika poľnohospodárstva, vol. 13, no. 4, p. 12.

Kao, C. 2017. Network Data Envelopment Analysis. Switzerland : Springer International Publishing. 443 p. ISBN 978-3-319-31716-8.

Kravcakova Vozarova, I., Kotulič, R. 2016. Quantification of the effect of subsidies on the production performance of the Slovak agriculture. Procedia Economics and Finance, vol. 39, p. 298-304. https://doi.org/10.1016/S2212-5671(16)30327-6

Ladvenicová, J., Miklovičová, S. 2015. The relationship between farm size and productivity in Slovakia. Visegrad Journal on Bioeconomy and Sustainable Development, vol. 4, no. 2, p. 46-50. https://doi.org/10.1515/vjbsd-2015-0011

Lančarič, D., Tóth, M., Savov, R. 2013. Which legal form of agricultural firm based on return on equity should be preferred? A panel data analysis of Slovak agricultural firms. Studies in Agricultural Economics, vol. 115, p. 172-173. https://doi.org/10.7896/j.1323

MARD SR. 2018. Single Area Payment Scheme - SAPS. Direct payments and cross- compliance. Ministry of Agriculture and Rural Development of the Slovak Republic, 2018. [online] s.a [cit. 2018-05-29] Available at: http://www.mpsr.sk/index.php?navID=47&sID=43&navID2=587.

Matošková, D., Gálik, J. 2013. Ther Competitiveness of Slovak products of animal origin. Bratislava, Slovalia : VUEPP, 111 p., ISBN 978-80-8058-594-5.

Munk, M. 2011. PC data analysis. Nitra : UKF. 361 p. ISBN 978-80-8094-895-5. (In Slovak)

Obtulovič, P. 2001. Biostatistics. Nitra : Slovak Agricultural University in Nitra. 90 p. ISBN 80-7137-901-8. (In Slovak)

OECD. 2016. OECD Regions at a glance 2016. Paris, France : OECD Publishing. 184 p. ISBN 978-92-64-25679-8.

Orsághová, D., Kozelová, D., Chládok, P. 2016. Evaluation of consumers' purchase behavior by means of mathematical and statistical methods. MERAA - Mathematics in Education, Research and Applications, vol. 2, no. 2, p. 75-81.

SO SR, 2016. Time series database. Slovstat 2016. Statistical Office of the SR [online] s.a [cit. 2018-05-29] Available at: https://slovak.statistics.sk/wps/portal/ext/Databases/slovstat/!ut/p/b1/04_Sj9CPykssy0x

Tangermann, S. 2011. Direct Payments in the CAP Post 2013. Note for the European Parliament's Committee on Agriculture and Rural Development. Directorate-General for Internal Policies [online] s.a [cit. 2018-05-29] Available at: http://www.europarl.europa.eu/RegData/etudes/note/join/2011/438624/IPOL-AGRI_NT(2011)438624_EN.pdf

Tóth, M., Boháčiková, A., Palkovič, J. 2017. Effects of CAP on acess to credit in Slovak Farms. In Agrarian Perspectives XXVI. Competitiveness of European Agriculture and Food Sectors. Prague, Czech Republic : Czech University of Life Science, p. 410-416. ISBN 978-80-213-2787-0.

Downloads

Published

2018-10-26

How to Cite

Kozáková, J. ., & Urbánová, M. . (2018). Is current system of direct payments suitable for farmers in Slovakia?. Potravinarstvo Slovak Journal of Food Sciences, 12(1), 716–722. https://doi.org/10.5219/941