Development and distribution of technological capital in agriculture: comparison of the Baltic countries

Abstract

Abstract. The value added created in the agriculture of Latvia and other Baltic countries is still not sufficient for the adequate remuneration of the production factors and further farm development. At the same time, there have been studies, which conclude that the increase in the productivity and the resource utilization efficiency in agriculture can be achieved by technological progress and development of technological capital; and after joining the EU, substantial financial funds were made available to the farm modernization in the Baltic countries. Therefore, the paper seeks to analyse how the development of technological capital has changed the concentration of fixed assets and value added among the farms of different size in the agriculture of the Baltic countries. The concept of the Lorenz curve has been applied in the study, using DG Agri FADN data of 2004-2013, which corresponds to the previous EU programming periods. The use of the Lorenz curve in the economic analysis of agriculture is a rather innovative approach applied in the paper. The results show that a significant amount of investment has been made in the agriculture of the Baltic countries, along with the increase in the agricultural value added created. Although the concentration level of fixed assets and value added differs among the Baltic countries; there is a similar concentration tendency -increase of the role of the large farms and their share both in the management of fixed assets and in the generation of value added.

How to improve agricultural value-added in the MENA region? Implementation of Diamond Porter's theory in agriculture

“…Sarma and Pais (2008) stated that bank credit not only increases AVA but also supports growth in GDP. Furthermore, credit and other forms of funding like agricultural investment have been shown to help AVA expand (Leimane et al, 2017).…”