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Selected Economic Determinants of Labor Profitability in Family Farms in Poland in Relation to Economic Size

Author

Listed:
  • Bożena Kusz

    (Department of Computer Engineering in Management, The Faculty of Management, Rzeszow University of Technology, Al. Powstańców Warszawy 12, 35-959 Rzeszow, Poland)

  • Dariusz Kusz

    (Department of Computer Engineering in Management, The Faculty of Management, Rzeszow University of Technology, Al. Powstańców Warszawy 12, 35-959 Rzeszow, Poland)

  • Iwona Bąk

    (Department of Applied Mathematics in Economy, Faculty of Economics, West Pomeranian University of Technology, Janickiego Street 31, 71-270 Szczecin, Poland)

  • Maciej Oesterreich

    (Department of Applied Mathematics in Economy, Faculty of Economics, West Pomeranian University of Technology, Janickiego Street 31, 71-270 Szczecin, Poland)

  • Ludwik Wicki

    (Institute of Economics and Finance, Warsaw University of Life Sciences-SGGW, 166 Nowoursynowska Str., 02-787 Warsaw, Poland)

  • Grzegorz Zimon

    (Department of Finance, Banking and Accountancy, The Faculty of Management, Rzeszow University of Technology, Al. Powstańców Warszawy 12, 35-959 Rzeszow, Poland)

Abstract
Farms in Poland come in a wide variety of sizes, and the effect of farm size on the profitability of labor has not been sufficiently investigated. This paper takes a fresh look at the model for labor profitability determinants of family farms in Poland in relation to their economic size. The purpose of this paper is to analyze the factors that determine the labor profitability index in farms of various economic size classes (classes ES1–ES5). In the analysis of factors shaping the profitability of labor in family farms, a panel analysis was applied. Family farm income expressed per family labor unit was adopted as the dependent variable. The following variables were used as explanatory variables: (1) macroeconomic index of price relations (“price gap”); unemployment; average monthly gross wages and salaries; inflation; (2) technical-agricultural production efficiency index; (3) microeconomic ratio of total assets to agricultural land; technical equipment for work; land-to-labor ratio; debt ratio, subsidy ratio, and investment effort. A diversified influence of selected factors determining the level of profitability of labor in agriculture in particular groups of farms was found. The econometric models developed also indicate different strategies that are adopted by farmers on various farms. There is no single solution here; strategies for improving the profitability of work must take into account the specificity of a given entity. The models estimated indicate the necessity of using other mechanisms and tools of agricultural policy for farms of various economic sizes. It should be expected that, in the future, there will be a dichotomous development of farms. Medium-sized farms will become larger and economically effective, and smaller farms will perform residential functions, with the disappearing function of agricultural production.

Suggested Citation

  • Bożena Kusz & Dariusz Kusz & Iwona Bąk & Maciej Oesterreich & Ludwik Wicki & Grzegorz Zimon, 2022. "Selected Economic Determinants of Labor Profitability in Family Farms in Poland in Relation to Economic Size," Sustainability, MDPI, vol. 14(21), pages 1-25, October.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:21:p:13819-:d:952224
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