Q18 - Agricultural Policy; Food PolicyReturn

The income of agricultural enterprises has always been influenced by both weather and price volatility. Nevertheless, the risk environment of various farms seems not to be the same. Similarly, risk factors are not independent of each other. The aim of the paper is to assess the spatial and commodity particularities determining the risk environment of agricultural enterprises in the Czech Republic. Within the main objective, the efficiency of crop insurance depending on farm size is also considered. Using calculation of statistical indicators of variability in the panel data, as well as Monte Carlo simulation, differences in farm risk exposure and efficiency of crop insurance between small and large farms were found. It was found that the risk of crop price volatility is generally of a more systemic nature and it is more difficult to diversify than the risk of crop yield volatility. The hypothesis that smaller crop acreage increases the risk of farm crop yield fluctuation was not statistically confirmed within a set of medium and large agricultural enterprises. In the sample of typical farms with specialized crop field types of farming, it was revealed that agricultural insurance is more effective for small farms than for large agricultural enterprises. Based on the main findings, we make some recommendations for the business sector and policy makers.

In the area of agricultural policy and the balanced growth of the countryside, the European Union promotes technological development and creation of jobs in ways that fulfil the criteria of ecological sustainability. The latest reforms to the Common Agricultural Policy are focused on the development of the countryside, which should greatly contribute to the solution of economic, social and environmental problems. The rural development policy is a part of the second pillar of the Common Agricultural Policy of the EU. The main opportunity for the development of the Czech countryside, and agriculture, is aimed at ensuring constant, sustainable growth and employment. It is necessary to fully utilise the cultural traditions, natural resources and the non-productive functions of agriculture and forestry in conjunction with the principles of environmental conservation and looking after the land. The fundamental strategic document which contributes to the implementation of the Lisbon Strategy is the National Strategic Plan for the development of the countryside of the Czech Republic in the period 2007-2013. The agenda for the development of the countryside of the CR in the period 2007-2013 specifies the individual objectives for development of rural areas, and it is an instrument for receiving support from the EU.

This paper presents an analysis of the available options for an effective EU rural development policy. A classification of the methods used to determine an optimal rural development policy can be viewed as the specific aim of the paper. This aim is achieved by discussing theoretical-methodological approaches to rural development, an analysis of the current situation in EU rural areas, including appropriate economic tools, and a partial analysis of existing methods for defining the optimal status in the rural areas. The paper also stresses the main economic determinants influencing conditions in EU rural areas. The authors point out a disproportion between agricultural subsidies and their utilisation in the actual development of the rural areas. Moreover, the definition of the target group of the CAP seems to be essential. The final part of the paper discusses the most significant approaches defining the optimal status in EU rural areas together with their risks and opportunities in respect of an effective rural development policy.