Ageing of farmers in the Czech Republic and the support from the EU funds

Download

JEL classification

• Agricultural Policy; Food Policy
• Business Taxes and Subsidies including sales and value-added (VAT)
• Demographic Trends, Macroeconomic Effects, and Forecasts

Keywords

Common Agricultural Policy, European Union, Rural Development Programme, subsidies, young farmers

Abstract

The age structure of managers of agricultural holdings is not favourable in the Czech Republic and follows the general trend of population ageing. The lack of young farmers represents a threat to generation renewal and the competitiveness of the sector, as younger farmers tend to be more open to innovation and more often learn new approaches to farming and business. Therefore, the European Union supports generation renewal through Com-mon Agricultural Policy instruments – direct payments and investment subsidies from the Rural Development Programme. The aim of the paper is to assess the ageing of the farm manager population and to evaluate wheth-er the support from the EU is well targeted on the regional level based on correlation analysis. Using statistical and administrative data, we find that the subsidies from the Rural Development Programme in the year 2016 were granted in line with the seriousness of the ageing problem. When there was a larger share of older farmers in a region, the share of young farmers supported was larger. Vice versa, the correlation coefficient between the share of supported farmers and the share of young farmers in the region is negative, meaning that the greater was the share of young farmers, the smaller was the share of supported farmers.