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A Microeconomic Model for Subsidies Allocation: the Case of Belarus

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  • Svetlov, Nikolai M.
  • Kazakevich, Iryna A.

Abstract

The paper develops a microeconomic methodological framework that allows approaching subsidy allocation across the types of assets and impact of subsidies on agricultural outputs and profits. The methodology is based on a non-parametric production frontier estimation. The empirical application is made to 1084 Belarusian corporate farms. The results suggest targeting governmental support at grain and milk production. In this case, 4.14 trillion Belarusian roubles of subsidies increase the overall profit of the sample farms by 1.46 trillion. In the case of targeting, the farms with higher overall efficiency are more sensitive to the support and are able to absorb larger amount of subsidies. The opposite is true in the absence of targeting.

Suggested Citation

  • Svetlov, Nikolai M. & Kazakevich, Iryna A., "undated". "A Microeconomic Model for Subsidies Allocation: the Case of Belarus," 2010 IAMO Forum, June 16-18, 2010, Halle (Saale), Germany 90826, Institute of Agricultural Development in Transition Economies (IAMO).
    • Handle: RePEc:ags:iamo10:90826
    DOI: 10.22004/ag.econ.90826
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    References listed on IDEAS

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    1. Abraham Charnes & William W. Cooper & Arie Y. Lewin & Lawrence M. Seiford, 1994. "Data Envelopment Analysis: Theory, Methodology, and Applications," Springer Books, Springer, number 978-94-011-0637-5, August.
    2. Svetlov, Nikolai M., 2009. "Estimating internal transaction costs: the case of corporate dairy farms in Russia’s Moscow oblast," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 58(08), pages 1-8, November.
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