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The Economic Sustainability of Farms under Common Agricultural Policy in the European Union Countries

Author

Listed:
  • Marta Guth

    (Department of Macroeconomics and Agricultural Economics, Poznań University of Economics and Business, Al. Niepodległości 10, 61-875 Poznań, Poland)

  • Katarzyna Smędzik-Ambroży

    (Department of Macroeconomics and Agricultural Economics, Poznań University of Economics and Business, Al. Niepodległości 10, 61-875 Poznań, Poland)

  • Bazyli Czyżewski

    (Department of Macroeconomics and Agricultural Economics, Poznań University of Economics and Business, Al. Niepodległości 10, 61-875 Poznań, Poland)

  • Sebastian Stępień

    (Department of Macroeconomics and Agricultural Economics, Poznań University of Economics and Business, Al. Niepodległości 10, 61-875 Poznań, Poland)

Abstract

The aim of this paper is to determine the influence of the Common Agricultural Policy’s (CAP) subsidies on the level of economic sustainability of farms by means of three-fold study. To determine the economic sustainability of farms the authors applied the income gap ratio. Next, the level of income differentiation between farms of various economic classes was established. The last part consisted of the recognition of statistically significant CAP schemes that shape agricultural income in farms of different size and in assessing how the respective subsidies should increase or decrease to fill the recognized gap, based on the coefficients of panel regression. The spatial scope covered all EU countries in 2005–2015. Results show that due to the CAP’s support the average income of farms has approached the average non-agricultural income, but distribution of this support favored the largest farms, increasing disparities within the sector.

Suggested Citation

  • Marta Guth & Katarzyna Smędzik-Ambroży & Bazyli Czyżewski & Sebastian Stępień, 2020. "The Economic Sustainability of Farms under Common Agricultural Policy in the European Union Countries," Agriculture, MDPI, vol. 10(2), pages 1-20, January.
    • Handle: RePEc:gam:jagris:v:10:y:2020:i:2:p:34-:d:314937
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    References listed on IDEAS

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