Structural, productive and financial characterization of farms run by young farmers

Abstract

In the European Union, only 8.7% of farmers are under 35 year-old and 36% are over 55. In Spain, the problem of scarcity of young people in the countryside is even greater, being the number of young farmers lower than 7%. The tendency of reduction in the number of farmers together with the strong entry barriers limit the generational renewal in the agricultural sector. In addition, farming is not identified as a sector of high entrepreneurship, but rather as a sector where profitability is very dependent on the levels of agricultural subsidies. The different aid programs of the CAP to encourage the retirement of old farmers and the installation of young farmers, maintained for decades, have not shown to be effective in attracting young people to agriculture. It is assumed that age is an important factor in making business decisions so that the rejuvenation of the agricultural sector could improve human capital in the sector and, with it, the dynamism, innovation and competitiveness of agriculture. Likewise, it could contribute to a better valuation of agricultural activity and working conditions. However, in the academic literature there is little evidence of the role of young people in agriculture. In the present study, the structural, productive and economic-financial characteristics of the farms in Andalusia are analyzed in order to contrast the differences according to the age of the farmers. In addition, a regression analysis is carried out to find out which are the variables that most influence the age of farmers, using as independent variables those extracted from an analysis of principal component analysis. The results confirm some of the hypotheses pointed out by the literature: young people are more educated and obtain higher levels of productivity, as well as higher profitability ratios; they are less dependent on the aid from the CAP and are more present in horticultural orientations, except for citrus, and in livestock they have more presence in milk and in sheep and goats.