Human capital (HC) plays an important role in modern agriculture. The difference in efficiency of assets explains only about a half of the economic performance of agricultural farms, while the other half relies on HC. Although education and training are the main components of HC, it may also be viewed from the perspective of behavioral theories that were taken under consideration in this study. The role of HC in sustainable farming has not been sufficiently explained when it comes to contractual governance (CG). In this study, the meaning of contractual governance was extended and the eco-contractual governance (ECG) concept was proposed, which stands for CG induced by agri-environmental contracts. The main objective of the article is to confirm the latent concepts of HC and ECG and to verify their correlation in view of the standards imposed by the agricultural policy. To achieve this goal, a structural equation model was developed and simultaneous confirmatory factor analysis with ordinal variables was carried out based on the sample of 674 small farms in Poland. The analysis has confirmed a relatively strong correlation between HC and ECG. It was revealed that training plays a crucial role in this relationship, while economic dependence on agricultural policy weakens the effectiveness of both HC and ECG.
The study presents the impact of eco-innovation and policy conducive to the implementation of the principles of sustainable development in agriculture on economic development. The starting point was the analysis of economic growth models and indicating in them the approach to innovation for the implementation of sustainable development. The specifics of eco-innovation in the agricultural sector and their typology have been presented. Due to the complexity of innovative processes and in particular the resulting effects, multi-component measures of innovation and eco-innovation have been discussed. In the last part, using the panel analysis, the effect of eco-innovation in agriculture on socio-economic development at the level of the entire economy has been demonstrated.
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