The Relationship of Agricultural and Non-Agricultural Income and Its Variability in Regard to Farms in the European Union Countries

Many authors emphasize that reducing the income deprivation of the agricultural sector in relation to the non-agricultural sectors is a prerequisite to the growth of sustainability of agriculture. Thus, this raises the question: despite the impact of the Common Agricultural Policy (CAP) on the value of agricultural income in EU countries, is there still income deprivation for agriculture in relation to non-agricultural sectors? If so, is its depth comparable among farms with a different scale of production from the same EU country or among farms with the same scale of production from different countries? The answers to these questions constitute the added value of the article. The aim of the paper is to compare the ratio of agricultural income to non-agricultural income in regard to family farms in EU countries. Results show that the CAP solutions do limit the agricultural income disparities but that there are significant differences in the income deprivation of farms with different production values in the same country. These differences also apply to farms with a similar production volume in different countries. This publication includes critical analysis of literature, spatial-analysis and panel regression. The time scale of the research is 2004-2017, the spatial scope is individual EU countries and the subjective scope is representative EU Farm Accountancy Data Network (FADN) farms.

Automated summary

This article discusses the ratio of agricultural income to non-agricultural income for family farms in European countries, revealing the impact of the Common Agricultural Policy on income disparities among farms. The study finds significant income deprivation differences among farms with different production values in the same country, as well as similar situations among farms with comparable production volumes in different countries.