The organisation of agricultural production in East Germany since World War II: Historical roots and present situation

Up to the end of World War II, the political-economic framework had been relatively similar all over Germany. However, the farm structure was different. While in both parts, the West and the East, about 90 per cent of all farms cultivated less than 20 ha and about one per cent more than 100 ha, the large fams cultivated about 7 per cent of the agricultural area in the West, but about 30 per cent in the East. Following the unconditional surrender of Germany in 1945 and its division by the four Allies, the differences in the organisation of agricultural production between East and West became more pronounced. In the Soviet Occupation Zone and then with the creation of the German Democratic Republic in October 1949, the socialist model of agricultural production was introduced in three phases: (1) an enforced "land reform" between 1945-49; (2) the repression of farmers cultivating more than 20 ha, starting in 1949, and finally (3) the collectivization of agricultural production starting in 1952 and finalised in the "Socialist Spring" in April 1960. While socialist agriculture had been built up on "blood and tears", it came to be fully accepted by the East German population over time and heavily defended also by those political forces which pushed for a regime change in 1989. With the collapse of the socialist regime in 1989 and German reunification in 1990, socialist agriculture had to be transformed into a system compatible with pluralistic democracy and market economy. Similarly, those whose assets had been confiscated were supposed to be restituted. However, the legal system at reunification differentiated between those who were expropriated either before 1945 or after 1949 and those between 1945 and 1949 under Soviet occupation. While the first group was entitled to restitution, the latter group received little compensation. At the time of transition, most politicians and agricultural economists assumed that family farming would re-emerge in the East and the modes of agricultural production would adjust between the two parts. However, even more than two decades after reunification, German agriculture is characterized by two distinguished different agricultural production systems. While West German agriculture continued the tradition of small-scale family farms relying on family labour, East German agriculture is characterised by large-scale corporate farms relying on permanently employed labour. In this way, German agriculture can be characterised as "One country - Two systems".