Acta Univ. Agric. Silvic. Mendelianae Brun. 2013, 61(7), 2883-2891 | DOI: 10.11118/actaun201361072883

Analysis of inequality of gross added value of conventional and organic farms in selected EU countries

Gabriela Trnková, Zdeňka Malá
Department of Economics, Faculty of Economics and Management, Czech University of Life Sciences Prague, Kamýcká 129, Praha 6, 165 21, Czech Republic

The paper deals with the differentiation of gross added value of farms with a focus on mixed production from twelve selected European Union countries in view of the manner of farming. The objective is to define the effect of an ecological and conventional manner of farming on the differentiation of gross added value and to quantify the level of impact of subsidy policy on the elimination of the said inequality. The fulfillment of the said objective was based upon the quantification of the Gini coefficient, which was quantified for selected indicators on the basis of data from the FADN database for the year 2009. In order to assess the effect of the manner of farming on the differentiation of the analyzed indicators, a horizontal decomposition of the Gini coefficient was performed. On the other hand, a vertical decomposition of the Gini coefficient served to assess the effect of EU subsidy policy on the level of inequality of the indicator of gross added value. The obtained results indicate a lesser inequality of the economic productivity of European agricultural businesses, which is not significantly determined by an ecological or conventional manner of farming, but rather by the local specifics of individual countries and their agricultural-food markets, as well as the applied subsidy policy, which primarily in organic farming decreases the inequality of gross added value to a significant extent and strengthens the competitiveness as well as viability of agricultural businesses.

Keywords: inequality, gross farm income, subsidy, Gini coefficient, organic farming, conventional farming, European Union
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The knowledge contained in the article arose out of MSM 6046070606 "The Economy of Resources in Czech Agriculture and Their Effective Utilization within Multifunctional Agricultural-Food Systems".

Received: August 29, 2013; Published: December 24, 2013  Show citation

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Trnková, G., & Malá, Z. (2013). Analysis of inequality of gross added value of conventional and organic farms in selected EU countries. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 61(7), 2883-2891. doi: 10.11118/actaun201361072883
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