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The relation between agricultural and non-agricultural economic development: Technical report on an empirical analysis of European regions

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  • Margarian, Anne
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    Abstract

    Support of agriculture is justified, among others, by its contribution to rural economic development. Nevertheless, the relation between agricultural and general economic development may be ambiguous. On the one side, agriculture may affect other sectors positively via multiplier and income effects. On the other side, competition effects may arise due to the application of common factors, specifically labour, by agriculture and other sectors. Under these circumstances, support of agricultural production may create distorted market signals and thereby affect the medium and long-term economic development negatively. This research analyses the regionally differentiated relation between the agricultural and the non-agricultural development empirically. The panel estimation model applies data of the common regional accounts from NUTS3 regions of the EU27. It identifies different development regimes with different roles for agriculture. In the most developed economies, competition effects dominate. Nevertheless, in low-productivity regions of Eastern Europe, agriculture stabilises the development of employment and value added. Thereby, policy faces the challenge to support simultaneously structural change in agriculture and the development of other sectors in rural regions. -- Die Unterstützung des landwirtschaftlichen Sektors wird unter anderem mit dessen Beitrag für die ländliche wirtschaftliche Entwicklung gerechtfertigt. Die Rolle einer stabilen Landwirtschaft ist aber möglicherweise ambivalent: Positive Impulseffekte könnten eben-so von ihr ausgehen wie negative Konkurrenzeffekte. Unter diesen Bedingungen kann eine sektorale Förderung durch falsche Marktanreize mittel- und langfristig auch negativ auf die allgemeine wirtschaftliche Entwicklung wirken. Der vorliegende Beitrag analysiert den regional differenzierten Zusammenhang zwischen der landwirtschaftlichen und der außerlandwirtschaftlichen Entwicklung empirisch. Das verwendete Panel-Schätzmodel nutzt Daten der regionalen volkswirtschaftlichen Gesamtrechnung der NUTS 3-Regionen der EU27. Es werden verschiedene Entwicklungsregime mit unterschiedlichen Rollen der Landwirtschaft identifiziert. In entwickelten Volkswirtschaften dominieren die Konkur-renzeffekte zwischen den Sektoren, doch gerade in den Regionen Osteuropas mit geringer Produktivität wirkt die Landwirtschaft stabilisierend auf die Entwicklung von Wertschöp-fung und Beschäftigung. Daraus ergibt sich die politische Herausforderung, den landwirt-schaftlichen Strukturwandel zu unterstützen und gleichzeitig die Entwicklung anderer Sek-toren in ländlichen Regionen zu stärken, damit frei werdende Produktionsfaktoren vor Ort genutzt werden können.

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    Bibliographic Info

    Paper provided by Johann Heinrich von Thünen Institute, Federal Research Institute for Rural Areas, Forestry and Fisheries in its series Arbeitsberichte aus der vTI-Agrarökonomie with number 01/2012.

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    Date of creation: 2012
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    Handle: RePEc:zbw:vtiaba:012012

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    Keywords: Europe; regional development; structural change; sectoral development; role of agriculture; Europa; Regionalentwicklung; Strukturwandel; Sektorale Entwicklung; Rolle der Landwirtschaft;

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