Perpetuation of subsistence farming in Western Balkans: the role of factor market imperfections
AbstractThe paper analyses the imperfections in output and factor markets in Kosovo that act as a barrier to farm commercialisation. On the one hand, agricultural households may not have access to output market due to an underdeveloped downstream sector. On the other, local producers might not be preferred to importers as their production level is small with a variable quality due to constraints in factor markets. Data from the Agricultural Household Survey 2005 are used. A conceptual framework is developed on the basis of a household model where non-separability results from a “wedge” between purchase and sale prices due to transaction costs. The share of the output sold in the total value of output is regressed over a set of explanatory variables. A truncated regression is employed due to the high percentage of the dependent variable having the value of zero. Many of the observations do not contain all three factor prices - land rent, wages and interest. For this reason three separate regressions are run, each containing one of the prices. The model including wages is non-separable. Households with more members sell less as they have preferences for household needs. This calls for active rural development and educational policy which can create labour opportunities for agricultural households.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Agricultural Economics Society in its series 82nd Annual Conference, March 31 - April 2, 2008, Royal Agricultural College, Cirencester, UK with number 36860.
Date of creation: 30 Mar 2008
Date of revision:
subsistence farming; agricultural households; separability; market imperfections; Kosovo; Q12;
Find related papers by JEL classification:
- Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- John Lingard, 2003. "A Comparative Advantage Analysis of Kosovan Agriculture," Post-Communist Economies, Taylor & Francis Journals, vol. 15(3), pages 417-434.
- Philip Kostov & John Lingard, 2004.
"Subsistence Agriculture in Transition Economies: Its Roles and Determinants,"
Journal of Agricultural Economics,
Wiley Blackwell, vol. 55(3), pages 565-579.
- Philip Kostov & John Lingard, 2004. "Subsistence Agriculture in Transition Economies: its Roles and Determinants," Others 0410004, EconWPA.
- Smith, Richard J & Blundell, Richard W, 1986. "An Exogeneity Test for a Simultaneous Equation Tobit Model with an Application to Labor Supply," Econometrica, Econometric Society, vol. 54(3), pages 679-85, May.
- J. Taylor & Irma Adelman, 2003. "Agricultural Household Models: Genesis, Evolution, and Extensions," Review of Economics of the Household, Springer, vol. 1(1), pages 33-58, January.
- Newey, Whitney K., 1987. "Efficient estimation of limited dependent variable models with endogenous explanatory variables," Journal of Econometrics, Elsevier, vol. 36(3), pages 231-250, November.
- Sauer, Johannes & Davidova, Sophia & Latruffe, Laure, 2009. "Determinants of the Fallowing Decision in Kosovo," 83rd Annual Conference, March 30-April 1, 2009, Dublin, Ireland 51072, Agricultural Economics Society.
- Sauer, Johannes & Davidova, Sophia & Latruffe, Laure, 2009. "Determinants for fallowing land: The case of Kosovo," 2009 Conference, August 16-22, 2009, Beijing, China 51626, International Association of Agricultural Economists.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search).
If references are entirely missing, you can add them using this form.