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Improving the State Support of Agriculture in a Region

Author

Listed:
  • Valentina Neganova
  • Aleksey Dudnik

    (Kurgan State Agricultural Academy named after T. S. Maltsev)

Abstract

The improvement of state support for the agro-industry in regions is relevant. The purpose of the study is to find the opportunities for increasing investments to the agriculture, as well as to maximize returns from them. At the same time, an optimal structure of the fixed-capital assets of agriculture as well as the acceleration of the new technological wave in the national economy are necessary. Our hypothesis is that investments play the key role in developing the competitive advantages of agriculture. The study is based on Cobb-Douglass production function. The recipients of funds have a tendency to opportunistic behavior, which increases as the volume of support rises. This tendency is an important restriction that influences the investment efficiency. As a promising solution, we propose to grant the status of investment use to the funds received by the agricultural industry within the programmes of support. This status may be changed only when the funds are used many times for the investment purposes including input suppliers. It will provide both a high return from the funds supporting of agriculture and their budget effectiveness. Moreover, It will help to minimize opportunistic behavior of the recipients of funds. For preventing the investment mistakes connected with the choice of sub-optimal technological solutions, we propose to standardize State investment options. These options will include projects, which completely or mainly use the Russian-origin inputs, providing high production efficiency. The authors’ suggestions can be used by both researchers to investigate the increase in efficiency of state support in regional agriculture and universities in educational process.

Suggested Citation

  • Valentina Neganova & Aleksey Dudnik, 2018. "Improving the State Support of Agriculture in a Region," Economy of region, Centre for Economic Security, Institute of Economics of Ural Branch of Russian Academy of Sciences, vol. 1(2), pages 651-662.
    • Handle: RePEc:ura:ecregj:v:1:y:2018:i:2:p:651-662
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    References listed on IDEAS

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    1. Ali Yousefi & Parisa Karbasi & Amir-mozafar Amini, 2013. "The impact of Iranian Targeted Subsidy Plan on the Comparative Advantage of Dairy Farms," International Conference on Energy, Regional Integration and Socio-economic Development 6048, EcoMod.
    2. Irina Golova & Alla Sukhovey, 2015. "Innovation And Technological Development Of Industrial Regions In The Conditions Of Socio-Economic Insecurity," Economy of region, Centre for Economic Security, Institute of Economics of Ural Branch of Russian Academy of Sciences, vol. 1(1), pages 131-144.
    3. Emvalomatis, Grigorios & Oude Lansink, Alfons G.J.M. & Stefanou, Spiro E., 2008. "An Examination of the Relationship Between Subsidies on Production and Technical Efficiency in Agriculture: The Case of Cotton Producers in Greece," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6673, European Association of Agricultural Economists.
    4. Cory G. Walters & C. Richard Shumway & Hayley H. Chouinard & Philip R. Wandschneider, 2008. "Information and Opportunistic Behavior in Federal Crop Insurance Programs," Working Papers 2008-9, School of Economic Sciences, Washington State University.
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    Cited by:

    1. A. M. Kalinin & V. A. Samokhvalov, 2020. "Effectiveness of Financial Support to Agriculture: General Assessment and Inter-Budget Effect," Studies on Russian Economic Development, Springer, vol. 31(5), pages 565-572, September.

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