This paper empirically identifies differences between dairy farmers in their perception of opportunities for farm development. The construct 'perceived Room for Manoeuvre' (pRfM) is used which is defined as: 'the opportunities perceived as viable in order to obtain a (substantial part of) business income'. A unique case study of 79 dairy farmers operating in a highly comparable socio-material context at the level of the case study allows for an empirical analysis of differences in the pRfM using a mix of quantitative and qualitative methods exploratory research, a questionnaire and in-depth interviews with stakeholders in farm development. Differences in the pRfM will likely affect the early phase of strategic decision making and consequently explain heterogeneity in farm development. Data analysis revealed the following three dimensions of pRfM: perception of the opportunity (1) to diversify; (2) to end production; and (3) to maximise production. These dimensions proved useful to explain heterogeneity in farm development and thus showed the importance of a subjective approach towards opportunity identification in farm development. This paper shows the need to view the farmer as entrepreneurial actor in the process of strategic decision making who interacts with the socio-material context of the farm.

Understanding heterogeneity in farm development strategies is important in order to design effective policies and support programs to increase the sustainability of agriculture in relation to its socio-material context. Using a unique case study of 102 dairy farmers in The Netherlands, all operating in a highly similar socio-material context, this paper studies the differences in the relation of farms with the socio-material context. To this end, the concept of threefold embedding is developed and tested using the ideal-typical characteristics of three patterns of farm development that were identified in the case study: (1) maximising total milk production; (2) optimising milk production using mainly on-farm resources; and (3) diversified on-farm production. Threefold embedding was conceptualised in relation to the following dimensions: (1) value chain relations; (2) socio-cultural relations; and (3) natural resource relations, while using a scale ranging from a Close to a Stretched set of relations. The concept of threefold embedding proves to be useful to identify in a non-normative and non-binary manner meaningful differences between patterns of farm development. These differences relate to differences in opportunity identification and strategic decision-making. The concept supports a relational perspective in studying farm strategy development using a sociology of entrepreneurship approach.

Nature and landscape are increasingly appreciated as public goods and community assets in need of protection. Policy schemes aiming to protect vulnerable nature and landscape assets affect options for farm development and thus the opportunities for farm income strategies. Farmers as small business owners need to counter an ongoing income squeeze in their strategic decision. Farmers’ perception of the options affects strategic decision making. In a case study with dairy farmers operating in a highly comparable biophysical and socio-economic context, farmers differed in the perception leading to three main income strategies: ‘maximising’ or ‘ending’ of milk production and ‘diversification of farm business’ with the most dominant strategy being ‘maximising’. Multiple regression analysis was used to explore the significance of seven drivers for the differences between farmers’ perception of farm development options. The ‘personal views and preference’ is the most significant explanatory driver for all three income strategies. ‘View on markets’ is of less significance and ‘view on urban-rural relation’ is not significant in explaining differences between farmers. ‘Maximising’ and ‘diversifying’ are opposites in their drivers. To increase the effectiveness of policy schemes and support programmes, personal views and preferences of farmers need to be taken into account.

. This interest is in both the process of making strategic decisions and in how this is affected by the relation of the farm with its context. In the process of making strategic decisions, farmers aim to secure a family farm income and to secure the continuity of the farm business. In the reiterative and continuing process of strategic decision-making, farmers aim to anticipate and balance the effect of developments within the context of the farm, with the needs and aims of the family farm. In this process the farmer relates in an implicit or explicit manner towards the dynamic and complex context, under which the farm operates. The farmers' decisions lead to (changes in) farm practices and these farm practices are embedded into the context in which the farm operates. Embedding of the farming practices, in turn, affects the context of the farm. When the farm affects the context, it is likely to also affect the opportunities for further farm development and future strategic decisions. This means that farm development is not isolated from, but closely related to, and affected by, the context, under which the farm operates.