Determinants of agricultural farm participation in regional economic systems

Abstract

With a growing population, epidemiological hazards, climate risks, no clear prospects for obtaining safe energy and increasing environmental pollution, food production systems need to develop in a sustainable manner, i.e. with no adverse impact on the environment or sanitary conditions and with sparing use of energy, while securing quantitative and qualitative demand for food, which is steadily increasing. In stimulating agricultural farm development, various theories of enterprises, including the consumerist and neoclassical theories, need to be taken into account. However, cooperative theories, transaction cost theories and agency theories, which favour joint action between entities (synergistic effect), should be increasingly important in this respect. To identify major determinants of agricultural farm participation in regional economic systems. The Pearson correlation coefficient was applied to determine the relationships between selected features of agricultural farms, the agri-food sector and regional economic parameters which affect the participation of farms in regional economic systems. Data for the analysis were obtained from Statistics Poland in Warsaw, Poland. The way to enhance the synergistic effect arising from strategic cooperation in food chains is primarily to increase the participation of farms in regional economic systems. Agricultural farms virtually do not compete directly with other farms for a position in the food market, but they do compete for a position in processing companies' supply systems. The ability of farms to sell raw materials is determined by the market efficiency of the food sector enterprises. The added value of the study will result, inter alia, from the identification of relationships between the variability of endogenous factors that characterise farms and the major exogenous factors affecting the participation of farms in regional economic systems.