Jana Fritzsch

FARM AND NON-FARM INCOMES OF RURAL HOUSEHOLDS IN SLOVENIA CANONICAL CORRELATION ANALYSIS

Farm and Non-farm Incomes of Rural Households in Slovenia Canonical Correlation Analysis This paper provides an analysis of socio-economic characteristics and their influence on farm and non-farm incomes of rural households in Slovenia. With the canonical correlation analysis we use a methodological approach that offers a true multivariate procedure for both sides of the equation. It thus goes beyond a simple pair-wise correlation analysis and also beyond multiple correlation analysis. This rather rarely used statistical method offers interesting insights into many fields of analytical applications. Our results confirm that rural households usually turn towards non-farm employment if distress-push factors prevail. Besides insufficient farm incomes, large household sizes push households into non-farm diversification. Employment opportunities in the non-farm sector- regardless of whether triggered by distress in the household or demand in the non-farm sector- depend strongly on education.

The Impact of Social Capital on Polish Farm Incomes: Findings of an Empirical Survey

Private farming is the dominant mode of agricultural production in most European countries. Not all farmers are equally successful, economically, which is usually explained by different levels of production factors, i.e. land, labour and capital. This article analyses whether social capital is an additional factor contributing to higher agricultural incomes. Using primary evidence from a farm survey in Poland among 410 farmers it can be deduced that social capital is indeed a significant factor determining the level of agricultural income. However, its impact is not as clear-cut as anticipated. The elaboration and testing of appropriate indicators has just started. More in-depth analysis will be needed in the future.

Individual farm exit decisions in Croatian family farms

Successful structural change in agriculture depends on several preconditions, some of which are only indirectly linked to the farming sector. The rural non-farm economy is known as one important driver of structural change because it offers alternative employment. However, little is known about the factors that influence farm exit decisions. Based on a recent household survey of Croatian family farms, we analyse individual employment decisions of farm household members by taking a prospective look at developments to come in the medium term. We find that mixed activities and part-time farming will be at the core of expected future developments. A cumulative logit regression model is employed, showing that steps toward individual farm exit are least likely for elderly people and for those in households that are particularly successful in farming. Individual exit is more likely for better-off households. Generally, we find that there is a clear trend toward non-farm employment for individuals, but there are hardly any indications that this leads to final abandonment of the farm.

Does Cooperation Pay? The Role of Social Capital among Household Plot Farmers in Ukraine

Does Cooperation Pay? The Role of Social Capital among Household Plot Farmers in Ukraine Social capital matters, not the least in determining individual welfare. It is argued that it functions similar to traditional production factors. However, there are not many empirical analyses about this issue at the farm-household level in general and in post-communist countries in particular. Whether or not social capital affects farm income is tested using micro-data from 255 household plot farmers in Ukraine. The data reflect 23 social capital indicators. These are merged in four separate index variables. The index variables reflect the theoretical dimensions of social capital, namely form, i.e. structural and cognitive, and relationship, i.e. bonding and bridging. By adopting multiple regression analysis, it can be shown that social capital in the form of bridging is indeed a significant factor for determining the level of agricultural income. However, the findings also underline the multidimensional side of social capital. Both bonding and cognitive social capital show no immediate impact on agricultural income among household plot farmers in Ukraine.

Is non-farm income diversification a feasible option for small-scale farmers? An assessment using a composite fuzzy indicator

European politicians encourage the income diversification of rural households through various measures. Although a knowledge of farm households’ potential for non-farm income diversification seems important for finely targeting such policy measures, thus far no attempt has been made to summarise the various determinants of income diversification in a single figure. This contribution aims to close this gap. A composite fuzzy indicator that measures farm households’ potential for non-farm income diversification is developed and applied to 626 small-scale farm households in Bulgaria, Hungary, Poland, Romania and Slovenia. The indicator summarises the incentives and capacities for non-farm income diversification on the individual household member level and on the household and regional levels in a single measure using fuzzy logic methodology. The composite fuzzy indicator performs well and the results for the single small-scale farm households can easily be retraced. The indicator not only singles out the households that have the potential for non-farm income diversification but also shows the reasons for this. The indicator shows that most of the 626 households studied have a high potential for non-farm income diversification and that all are pushed toward diversification by the small size of their farms. The composite fuzzy indicator also identifies farm households that are trapped in a desperate situation due to unfavourable chances of finding a job in the labour market and long distances to the nearest large urban centre. Decision makers could utilise the composite fuzzy indicator to finely target diversification measures to the multifaceted conditions of farm households.