Autoregressive approach for exploring the gross value added in agriculture and the number of agricultural holdings in Bulgaria
Keywords:
agricultural holdings, ARDL models, gross value added in agricultureAbstract
Development of agriculture in Bulgaria is of a great importance for reaching sustainability in rural areas in the country. The aim of this research is to find some of the factors, influencing gross value added (GVA) in agriculture and the number of agricultural holdings in Bulgaria, using autoregressive distributed lag (ARDL) models.
The study includes two parts. In the first part the theoretical basis of some of the most important factors, influencing GVA and number of agricultural holdings are revealed. In the second part, autoregressive distributed lag (ARDL) models are developed for the GVA in agriculture and for the number of agricultural holdings. According to the results some conclusions are made. The ARDL model for the gross value added in agriculture is highly significant with R2 of 0.9872. The dummy variable is also highly significant, showing that there is a significant difference in the GVA in agriculture before and after the EU accession of Bulgaria. The difference in the GVA in agriculture appears with one-year lag after the accession (from 2008). According to the long-run model, the employed persons with higher education influence significantly over GVA in agriculture. The coefficient in front of the employed persons with higher education is a positive number, meaning that with the increase of persons with higher education, GVA also increases and vice versa. So the human factor appears to be of a great importance for the gross value added in agriculture. The coefficient of the foreign direct investments in agriculture is a positive, but an insignificant number in the long-run. The speed of adjustment is 79.24%, highly significant and a negative number.
The model for the number of agricultural holdings is highly significant with a coefficient of determination of 0.9984. The population number significantly influences the number of agricultural holdings in a long – run, as well as in a short-run and the processes of decline of population, have a direct impact on the number of agricultural holdings. It means the smaller the population number, the smaller the number of agricultural holdings in Bulgaria. In the long-run model the coefficient in front of the average utilized agricultural area is negative and insignificant. The speed of adjustment is 47.76%.
The results and conclusions of the study can be used as an instrument for benchmarking of the Bulgarian agriculture.
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