Promoting change or preserving the status quo? - the consequences of dominating local politics by agricultural interests. Some evidence on structural change in Poland during the transition period

Though there is a vibrant debate about the determinants of structural change in agricultural sector, the broad consensus is that it is mainly driven by economic environment and farmers' characteristics. In this paper, we try to complement this view and study whether the pattern of farm exits is shaped by rural politics. Using local-level data for Poland, and accounting for variables commonly used in other studies, we show that in the period 1996-2010, the scope and speed of structural change in agricultural sector were heavily influenced by the extent to which municipality councils were captured by agricultural interests. More specifically, we find that in regions with higher political representation of farmers there were less exits from farming and land consolidation process was slower. Thus, our findings suggest that investigating the distribution of political resources at the local level might be as important for our understanding of structural change as studying the impact of farm size or the development of non-agricultural job opportunities.