What is it about?
This study examines why income differences between farmers are so large and why they persist across countries. Many small farms struggle with limited land, weaker market positions, and less access to credit or new technologies, while large farms benefit from economies of scale and stronger bargaining power. Government subsidies are intended to support farmers, but they often go disproportionately to large, wealthier farms. As a result, subsidies can increase inequality rather than reduce it. The paper compares data from Europe, the United States, and developing countries, showing that the structure of farm support systems strongly shapes income distribution. It highlights that better-targeted policies—especially those supporting small farms, poorer regions, women farmers, and access to digital tools—could help create a fairer and more sustainable agricultural sector.
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Why is it important?
This paper makes two main contributions. First, it shows that agricultural income inequality is not only the result of differences in farm size or market conditions, but also a direct consequence of how governments design and allocate farm subsidies. Although many studies analyze inequality and many analyze subsidies, few connect the two in a way that spans countries and uses comparable empirical approaches. This paper fills that gap. Second, the study compares the main datasets used to measure farm incomes—EU-SILC, FADN, and ARMS—and demonstrates that each captures a different segment of farms. This matters, because when small or informal farms are underrepresented, standard inequality measures will understate the true extent of disparities. These insights are timely. As governments debate the future of agricultural support under climate and budget pressures, the findings show that poorly targeted subsidies may worsen inequality. Recognizing this helps design policies that better reach the farms most in need.
Perspectives
What motivated this paper was my growing sense that we often talk about farm income inequality as if it were purely structural, when in reality policy choices play a much larger role than we admit. Working with different datasets made this even clearer: depending on what we measure—and whom we fail to capture—we can misread the scale of inequality. My hope is that readers see agricultural inequality not as an inevitability, but as something shaped by decisions. With more transparent data and better-targeted support, we can meaningfully improve outcomes for smaller and more vulnerable farms.
Professor Imre Fertő
Eotvos Lorand Tudomanyegyetem
Read the Original
This page is a summary of: A mezőgazdasági jövedelmi egyenlőtlenségek szerkezete és szakpolitikai kihívásai, Tér és Társadalom, September 2025, Ter es Tarsadalom,
DOI: 10.17649/tet.39.3.3647.
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