Economic size of farms and adjustments of the total factor productivity to the business cycle in Polish agriculture

Bazyli Czyżewski , Adam Majchrzak

Abstract

The article presents an approach to changes in the total factor productivity (TFP) which differs from that generally found in the literature. Changes are calculated in the real terms using the detailed input-output matrices for representative farms in Poland, for different economic size classes, in the years 2007–2013. Input-output matrices were used for the decomposition of the Hicks-Moorsteen TFP index. The goal is to evaluate changes in the real TFP in the downturn and recovery phases of the business cycle in agriculture. It was found that the reaction of TFP to business cycle changes on “small”, “medium” and even “large” family farms in Poland is diametrically opposite to that observed in the case of large-scale farms. More than 90% of farms in Poland (except for the largest) increase technical productivity in the conditions of the economic downturn and lower it in the conditions of the economic recovery. Such behaviour is pro-cyclic and irrational, alluding to the 17th-century King’s effect, which is vanishing in the agricultural systems of highly developed countries. The hypothesis is proposed that the size of the price expectation error which causes that effect is negatively correlated with the economic size of the farm, but at the same time it is proportional to the percentage of agricultural income obtained from subsidies and other payments under the SAPS system.
Author Bazyli Czyżewski (WE / KEiRK)
Bazyli Czyżewski,,
- Department of Education and Personnel Development
, Adam Majchrzak (WE / KPGiS)
Adam Majchrzak,,
- Department of Economic and Local Government Policy
Journal seriesAgricultural Economics-Zemedelska Ekonomika, ISSN 0139-570X, (A 15 pkt)
Issue year2017
Vol63
No2
Pages93-102
Publication size in sheets0.5
Keywords in Englishagriculture, business cycle, CAP, input-output analysis, TFP
ASJC Classification1101 Agricultural and Biological Sciences (miscellaneous); 2000 General Economics, Econometrics and Finance
DOIDOI:10.17221/240/2015-AGRICECON
URL https://www.agriculturejournals.cz/publicFiles/206857.pdf
Languageen angielski
Score (nominal)15
Score sourcejournalList
ScoreMinisterial score = 15.0, 20-03-2020, ArticleFromJournal
Publication indicators WoS Citations = 0; Scopus SNIP (Source Normalised Impact per Paper): 2017 = 0.787; WoS Impact Factor: 2017 = 0.706 (2) - 2017=0.643 (5)
Citation count*8 (2020-09-16)
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* presented citation count is obtained through Internet information analysis and it is close to the number calculated by the Publish or Perish system.
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