Subsistence farming in transitional economies: lessons from Bulgaria

doi:10.1016/S0743-0167(01)00026-2

Journal of Rural Studies

Volume 18, Issue 1, January 2002, Pages 83-94

https://doi.org/10.1016/S0743-0167(01)00026-2 Get rights and content

Abstract

Transition to market economies in Central and Eastern Europe has increased the practice of small-scale subsistence farming. Consequently agriculture is characterised by a dualistic structure of market-oriented commercial farms and much small-scale subsistence farming. An important part of the production and consumption of many food products is not marketed and this large share of subsistence makes agriculture performance unpredictable. The widespread prevalence of subsistence farming is a problem in predicting the aggregate effects of agricultural and rural policies. Analysis of this phenomenon is therefore important for policy making which will lead to adjustments in the agricultural and rural economy. Detailed study of one country in transition, Bulgaria, is presented. Findings and conclusions are then expanded to other CEECs.

Introduction

Transition to market economies in the CEECs has followed a different sequence than expected. Many forecasts failed to occur and now, more than ten years since reform began, study of these countries and their problems is a separate branch of economics, namely, economics of transition. Transition was initially regarded as an adjustment process of a severely distorted market economy. However, dramatic and unexpected changes in many countries have forced analysts to reconsider their views and recognise that the planned economy was radically different from a market one as a point of departure. The main achievement of the recent work on transition is the view of economic behaviour being defined within the structural characteristics of the economy. The patterns of behaviour are not given but are themselves undergoing a process of change. The dynamics of this process, in countries in transition can lead to different outcomes from similar points of departure. One important determinant of behaviour in the agro-food sector is the emerging, persistent and enduring problem of subsistence farming.

This paper is organised as follows. First we describe and define subsistence farming in the CEECs. Then we present a case study of subsistence in Bulgaria. We identify some of the determinants for emergence of subsistence agriculture and reasons for its persistence. The next part generalises results to other CEECs. Finally, we draw some conclusions about rural policy and future research.

Section snippets

Subsistence farming

In many CEECs there exists a bimodal farm structure comprising a small number of very large productive units—co-operatives, private farming companies, informal associations and partnerships and a very large number of small-scale farms. It is difficult to present a comprehensive comparative picture of the structures across Eastern Europe because of the different formats of information. Sarris et al. (1999) present detailed data. In Bulgaria, in 1996 less than 0.4% of the total number of farms

The context of transition

Liberalisation of price and trade regimes took place in February 1991, but the market had not been fully established and, to protect consumers, restrictions on prices and trade, particularly, for agricultural and food products were imposed. The state monopoly on foreign trade was removed but strong export restrictions (bans, high export taxes and minimum export prices) were introduced. Restrictions on prices and foreign trade were the general framework within which the economy developed during

Reasons for subsistence expansion during transition

The reasons for the expansion of subsistence farming during transition are complex—a combination of factors interact. We identify some of the major factors.

What has caused subsistence agriculture to persist in the CEECs?

This study of Bulgarian subsistence farming provides a detailed picture, but our aim is to provide general conclusions to other CEECs. The problem has specific country characteristics but common reasons for the emergence of subsistence agriculture can be identified, whilst those specific to a country will moderate the impact of the main forces. All CEECs experienced an initial period of macroeconomic instability at the beginning of transition. The length and degree of this period varied and

Conclusions

We have described the problem of subsistence agriculture in the CEECs—a paradoxical outcome of the transition to a market economy in which an important market disappeared. The problem with these tiny farms is not that they are small but that they are excluded from the market. They do not market their production and do not intend to. This defines behaviour that perhaps does not respond to market signals. Therefore, subsistence patterns need to be analysed and their effects on the overall

References (28)

S. Johnson et al.
On reform intensity under uncertainty
Journal of Comparative Economics
(1997)
G.W. Creed
Domesticating Revolutionfrom Socialist Reform to Ambivalent Transition in a Bulgarian Village
(1998)
F. Ellis
Peasant EconomicsFarm Households and Agrarian Development
(1993)
FAO, 1999. Strategy for Agricultural Development and Food Security in Bulgaria,...
S. Gudeman
The Demise of a Rural Economyfrom Subsistence to Capitalism in a Latin America Village
(1978)
Hayek, F. A. 1973. Law, Legislation and Liberty: a New Statement of the Liberal Principles of Justice and Political...
Ivanova, N., 1998. Macroeconomic impacts on agricultural price development during the transition period in Bulgaria....
Ivanova, N., Kostov, P., 1998. Economic Assessment of Agricultural Sector Developments during the Transition in...
Ivanova, N., Todorov, T., 1999. The Role of Agriculture in Transition: Case Study—Bulgaria, FAO-ESA,...
J. Kornai
Economics of Shortage
(1980)

Kostov, P., 1995. Employment in Bulgarian Agriculture During Transition, Working Paper No.2, Project 94.5, PAU, MAFI,...

P. Kostov et al.

Modelling the Effects of Subsistence on Bulgarian Agricultural Performance

(2000)

Kwasniewski, A., 1999. Address of the President of the Republic of Poland to the Ninth European Congress of...

McIntyre, R., 1988. The small enterprise and agricultural initiative in Bulgaria: institutional invention without...

Cited by (55)

Impact of urbanization on the eco-efficiency of cultivated land utilization: A case study on the Yangtze River Economic Belt, China
2019, Journal of Cleaner Production
Citation Excerpt :
Hence, the proportion of the number of hospital beds in urban areas to the total number of hospital beds in the entire area (including urban and rural areas) is a typical indicator of the barrier effect. Since the technology-driven aspect (i.e., the spatial spillover effect of technology) cannot be calculated directly, this study focused on the market-driven effect of urbanization on the ECLU (Kostov and Lingard, 2002). According to the theory of agricultural location, the most important factor influencing the market-driven aspect is the distance between the place of agricultural production and market (Duranton and Puga, 2001).
Today, scholars and governments focus on the loss of cultivated land resources as a result of urbanization, but ignore urbanization's impact on the eco-efficiency of cultivated land utilization (ECLU), which causes the wastage of cultivated land resources and environmental pollution. Hence, this study systematically analyzes how urbanization influences the ECLU and proposes four of the former's effects on the latter: agglomeration, barrier, driving, and feedback effects. Further, it uses the System Generalized Method of Moments (GMM) and threshold models to estimate urbanization's impact on the ECLU. The estimation results of System GMM model reveal that agglomeration and barrier effects have a significant negative effect on the ECLU, with regression coefficients of −0.6725 and −0.0415, respectively. Contrarily, driving and feedback effects have a significant positive effect on the ECLU, with regression coefficients of 0.0274 and 0.1423, respectively. Further, the threshold analysis demonstrates that the barrier, driving, and feedback effects of urbanization have single threshold values of 20.7%, 22.8%, and 18.2%, respectively, whereas the agglomeration effect by itself has two threshold values of 18.3% and 49.5%. The study concludes that focusing only on the urbanization-related occupation of cultivated land while ignoring the urbanization's effects on the ECLU will jeopardize food security and the ecological environment. After considering the effects of different levels of urbanization on the ECLU, the government should formulate appropriate policies and measures to realize the sustainable utilization of cultivated land resources.
Social sustainability in agriculture – A system-based framework
2019, Journal of Rural Studies
Citation Excerpt :
Basic needs can often only be fulfilled in this sphere. While small farms usually produce (parts of) their own food, they rely on the community, friends and family for other basic services (e.g. Kostov and Lingard, 2002). Security and safety are closely connected to community relations and the vitality of local communities.
Sustainability has become a key term for linking environmental, economic and social issues, in both the sciences and politics. Conceptions and frameworks of sustainability have thus arisen to evaluate agricultural systems on their sustainability. Within these conceptions and in political and scientific discourses, what can be understood as the social pillar of sustainability in agriculture varies greatly, especially in regards to the scope and the sustainability standards applied. While rural inhabitants have been subject of various ‘sustainability studies’, the consideration of the social dimension in agriculture is still rather underrepresented. Our conceptual framework can contribute to enhance the understanding of the social dimension of sustainability by utilizing a social science-based approach to comprehend the complexity of social interaction in agriculture: Based on Parsons' system approach, we capture the components of a social system that encompasses agriculture and its embeddedness in society. This includes all major actors, their interactions and institutions. Further, we develop Maslow's hierarchy of needs as well as the rights approach into a sustainability scale. We call the conceptual framework the sustainable agricultural social system. This general framework can later be adapted to local cultural and social settings, serving as a more comprehensive and flexible sustainability framework.
Land fragmentation and production diversification: A case study from rural Albania
2018, Land Use Policy
We analyze the impact of land fragmentation on production diversification in rural Albania. Albania represents a particularly interesting case for studying land fragmentation as the fragmentation is a direct outcome of land reforms. The results indicate that land fragmentation is an important driver of production diversification of farm households in Albania. We find that land fragmentation stimulates significantly more diversification for subsistence farm households than for market-oriented households. Our findings have two key policy implications: (i) the consolidation policies that relocate and enlarge plots would have a significant impact on reducing agricultural production diversification; and (ii) land fragmentation contributes to the nutritional security improvement by increasing the variety of foodstuffs produced by subsistence farm households.
Functional organization analysis for the design of sustainable engineering systems
2014, Ecological Engineering
Sustainable engineering design requires consideration of technical and ecosystem structures and processes. Even though the concepts of ecosystem services and natural infrastructure are maturing, their application in concrete engineering design is currently lacking due to their ambiguous definitions and a lack of methods that allow for the combined consideration of ecosystem and technical approaches in engineering design. This article proposes and discusses a new functional organization analysis (FOA) method for the comparative analysis and design of supply systems for basic needs (i.e., water, energy or food). This method allows for the analysis of the organization of system functions as well as underlying technical and ecosystem structures and associated processes. On this basis the method allows one to gather data, information, and knowledge about alternative system designs, and analyze their synergies. The theoretical and conceptual background of the proposed FOA method is presented, along with a case study regarding sustainable food supply systems in Southwestern Ontario.
Impacts of innovative forestry land use on rural livelihood in a bimodal agricultural system in irrigated drylands
2013, Land Use Policy
The conversion of marginal croplands to tree plantations, as an option to address climate change, land degradation, and irrigation water scarcity, as well as to improve the welfare of local population requires prior analysis. This study analyzed the impacts of afforestation of marginal croplands, including potential benefits in the form of carbon sequestration rewards via the Clean Development Mechanism, on the livelihood of commercial farms and rural households by considering their interdependencies via wage-labor relations in irrigated agricultural regions of the lower reaches of the Amu Darya River, Central Asia. A dynamic nonlinear programming model was developed that jointly maximizes profit of farm and net incomes of rural households over a 15-year horizon under conditions of decreasing irrigation water availability and forestry plantations with a single seven-year rotation period. The results showed that the introduction of short-rotation plantation forestry in degraded irrigated croplands can help mitigate the repercussions of water shortages on rural livelihood, while sustaining energy needs, income, and food security. Although income and food consumption of rural households may decline from year two to six after afforestation, the subsequent increase in farm profit following the harvest of tree plantations would be transmitted to rural households through existing wage-labor payment arrangements. The incorporation of fuelwood into labor payment schemes would substitute the use of fossil fuels by rural households and thus substantially decrease their energy expenses and CO₂ emissions. Furthermore, given the low irrigation water demand of trees, afforestation would increase irrigation water availability for more productive croplands.
Comparing the determinants of cropland abandonment in Albania and Romania using boosted regression trees
2013, Agricultural Systems
The collapse of socialist governance structures in Central and Eastern Europe led to the widespread abandonment of agricultural land. We estimated and compared the determinants of cropland abandonment in Albania and Romania during the postsocialist transitional period from 1990 to 2005. The data set included cropland abandonment derived from satellite image analysis, spatially continuous biogeophysical indicators, and socioeconomic surveys. Data were analyzed using boosted regression trees. Boosted regression trees can account for nonlinearities and interactions between variables and combine high predictive accuracy with appealing options to interpret the results. The results revealed important similarities between cropland abandonment in the countries and showed a strong correlation of abandonment with elevation and slope. Differences between cropland abandonment in Albania and Romania were apparent when the influence of topography was excluded. While physical accessibility tended to be more important in Albania, the density of cropland and input intensity were more decisive in Romania. The immediate time period following the collapse of socialism was dominated by extensive cropland abandonment in areas where agricultural production was no longer profitable. Gradual changes were observed in later stages of the transition period.

View all citing articles on Scopus

¹: Philip Kostov is a research student financed by EU ACE funds and Dr. John Lingard is a Senior Lecturer who acted as Adviser to an EU Phare project on Agricultural Market Reform in Bulgaria, 1992–1997.

View full text

Subsistence farming in transitional economies: lessons from Bulgaria

Abstract

Introduction

Section snippets

Subsistence farming

The context of transition

Reasons for subsistence expansion during transition

What has caused subsistence agriculture to persist in the CEECs?

Conclusions

Journal of Comparative Economics

Domesticating Revolutionfrom Socialist Reform to Ambivalent Transition in a Bulgarian Village

Peasant EconomicsFarm Households and Agrarian Development

The Demise of a Rural Economyfrom Subsistence to Capitalism in a Latin America Village

Economics of Shortage

Modelling the Effects of Subsistence on Bulgarian Agricultural Performance