Factors influencing farm profitability in the Republic of Serbia

Abstract

The paper deals with the production and economic indicators of farms in the Republic of Serbia based on data collected from the FADN sample for 2019. The aim of the research is to analyze and evaluate the influence of important factors on profitability of farms of different economic size. According to their economic size, farms are classified into four groups: very small, small-sized, mid-sized and large-sized farms. Factors influencing profitability are grouped into: production management, financial management, human resources management and subsidies and natural factors. The statistical technique used in the paper is a multiple regression model applied to determine statistically significant influence of certain factors on profitability. The results of the research show that equity turnover is the factor with the greatest positive impact on profitability of farms regardless of their economic size. Paid labour has the greatest negative impact on very small, small-sized and mid-sized farms. Further research should focus on analysis of the financial performance of small and medium farms which, based on the available capacities and income, are the main drivers of development of the entire agricultural sector.

Managing Employee Performance in the Agricultural Sector: Importance of Human Capital Development

“…The importance of human capital in creating the satisfactory performance of agricultural firms was proven by the authors (Gloy et al, 2002;Ming Chen, Jun Lin, 2004;Vukoje et al, 2022). High productivity and results of employees' work are achieved by the best use of employees' abilities and on the basis of achieving cost efficiency .…”

“…Xia et al (2020) believe that the increase in the number of employees is one of the key factors affecting the utilization and protection of agricultural land. Literature proves that human capital is one of the key factors in the profitability of agricultural firms (Gloy et al, 2002; Ming Chen, Jun Lin, 2004; Vukoje et al, 2022;Buallay, 2022). Bearing in mind the mentioned benefits of the use of human capital as well as its impact on the profitability of agricultural firms, there is a need to analyze the efficiency of its use and its impact on the results of agricultural firms.…”

“…Third, previous studies have analyzed the relationship between human capital and the competitiveness of agricultural firms (Dimovski et al, 2022); human capital and growth of firms (Pansy Wong et al, 2023); human resource management and motivation in agriculture (Ilic et al, 2022). Vukoje et al (2022) consider that future research should be based on the analysis of the financial performance of agricultural firms and farms, as well as the analysis of available capacities as the main drivers of the agricultural sector. Bearing in mind the observed research gaps, this study focuses on the analysis of HCE in agricultural firms and its impact on employee results i.e.…”