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Abstract
This article analyses the impact of off-farm employment on the process of commercialisation of agriculture in Romania. The descriptive and correlation analysis reveals the existence of an important relationship between off-farm employment and agricultural sales. High off-farm employment is correlated with low number of households selling agricultural products and with high amount sold per household, suggesting specialisation and commercial farming in the regions with off-farm employment. Non-agricultural employment has an indirect impact on agricultural sales as well, through increased labour productivity in agriculture and through easing access to credit. Moreover, commercial farms undertake substantial investments in agriculture, thus furthering commercialisation.
Notes
1. The Rural EuroBarometer survey was conducted between September 2002 and January 2003 on a representative sample of 1,963 rural households. The data were collected for the period November 2001–October 2002.
2. The reversal from 2000 on is explained by the improvement of the economic situation since 2000 signaled by the emergence of new private companies in the non-agricultural sector. Indeed, the number of new companies increased almost twofold in 2001 compared with 2000 and in 2002 an additional 50,000 new companies emerged (these include companies with one employee as well) (NIS, Citation2003).
3. The low labour productivity in agriculture is underlined by the high rate of underemployment in agriculture. Indeed, in 2002 underemployment affected mostly the population employed in the rural areas, and especially the population in agriculture, out of which 29% were working on a part-time basis (NIS, Citation2003b).
4. In 2002 4.7 million individual farms cultivated 62% of Romania's arable land area, with an average size of 1.6 ha (NIS, Citation2004).
5. The PHARE project used geographical, demographic, economic, social, infrastructure, living standards and environment criteria in the territorial analysis; see Phare Ro 9408/0101, ‘Regional Development Policy’ (Bucharest, Phare, 1994–1997).
6. GDP per inhabitant in 2002 at regional level was as follows (euros): NE— 1,590.4, SE— 1,909.0, S— 1,779.8, SW— 1,776.7, W— 2,408.4, NW— 2,091.9, Centre— 2,401.3, Bucharest— 4,628.7 (NIS, Citation2004c).
7. The analysis of the rural areas of the development regions also includes Bucharest region, which has a rural area concentrated around the capital city.
8. Employers are the owners of companies or of legal entities, different from the self-employed, who are individuals without legal status.
9. The number of working days in agriculture per person per year in the different regions should be considered approximations rather than exact values, since they are calculated from two sources. Thus, the number of working days in agriculture in 2002, as reported by the General Agricultural Census (NIS, 2004), is divided by the number of persons working in agriculture in 2002 from the Household Labour Force Survey (NIS, 2003b). The data on the number of working days in agriculture need to be used cautiously as well. Indeed, if on the unit investigated the working day is shorter than eight hours, the figure is converted into eight-hour working days. Moreover, in the case of agricultural households the working days in a year refer to the time allocated for farming activities by all household members, while in the case of commercial farms they refer to the work of employees and other staff categories. In commercial farms employees usually work five days a week while household members often report work at the weekend as well. However, given that the composition of agricultural units across the regions is pretty uniform, with agricultural households representing over 99% of the units in every region, the difference in the working time per week across the different units does not bias the calculations about underemployment (NIS, 2004). Fuller information about the calculations is available from the authors.
10. Poverty rate based upon consumption per adult equivalent in 2002: NE— 43%, SE— 32%, S— 33%, SW— 33%, W— 22%, NW— 23%, Centre— 23% and Bucharest— 11% (World Bank, Citation2003).
11. At household level the Pearson correlation index between the value of incomes obtained by selling agricultural products and the value of investment is 0.23 and it is significant at the 1% level.