Macroeconomic determinants of agricultural preferential investment credit in Poland

In the paper the impact of macroeconomic determinants on the number and value of agricultural investment preferential credits in Poland is examined. This kinds of determinants are of an exogenous character and they cannot be controlled by individual farm. They are related to economic growth, price level changes, monetary policy, inflation, changes in foreign trade conditions. The econometric analysis showed that macroeconomic environment influenced farmers’ credit decisions at number and value of taken credits. The statistically significant variables in the case of these measures were the index of price relations of sold agricultural products to goods and services purchased by private farms (“price gap”), interest rate of central bank and real interest rate paid by farmers. Somewhat surprisingly, neither rate of GDP growth nor real effective exchange rate affected the scope of credits. In the case of GDP rate, the result can suggest that farmers expectations does not depend on current phase of business cycle. The reason of luck the influence of terms of foreign exchange can be explained partly by relatively low share of agricultural products in foreign trade turnover.