What is it about?

The one of the main motivation for state intervention in agriculture is to stabilise farm income. We assess whether subsidies stabilise farm income in Hungary and Slovenia. Our results suggest that subsidies in Hungary and Slovenia have played a limited countercyclical role in stabilising total farm income.

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Why is it important?

The lack of a strong link between subsidies and farm income stability suggests that, while subsidies reduce instability in farm income, they are less likely to serve as an efficient tool for stabilising it. Subsidies are increasing the level of farm income, but are not stabilising farm income in Hungarian and Slovenian farms. They only reduce the volatility which arises from market farm income and, to a lesser extent, from the cost of external factors.

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This page is a summary of: Do CAP subsidies stabilise farm income in Hungary and Slovenia?, Agricultural Economics (Zemědělská ekonomika), March 2019, Czech Academy of Agricultural Sciences, DOI: 10.17221/190/2018-agricecon.
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