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Economy in Romania and the Need for Optimization of Agricultural Production Structures

by Jean Vasile Andrei (Author) Gheorghe H. Popescu (Author)
©2014 Thesis 172 Pages

Summary

Agriculture represents a basic economic sector for Romanian economy with major implication on a large part of inland population. The accession to the EU has imposed major changes to the Romanian agricultural sector to achieve better outcomes and to adapt to the new economic performance criteria. The book represents a pertinent analysis regarding the evolution of the Romanian agricultural sector and emphasis the need for optimization of the agricultural production structures. Valuing the inland agricultural potential involves designing well competitive production structures which should better combining all the productions factors existing in the rural areas and communities. The book contains five alternatives in designing the agricultural production structures.

Table Of Contents

  • Cover
  • Title
  • Copyright
  • About the author(s)/editor(s)
  • About the Book
  • This eBook can be cited
  • Table of Content
  • Introduction
  • Chapter I Importance of Agriculture in Romanian Economy
  • 1.1 General agricultural context of the Romanian economy
  • 1.2 Comparative developments of Romanian agriculture vs. European agricultural model
  • Chapter II Literature Review and Model Settings Research
  • 2.1 General remarks
  • 2.2 The Research objectives
  • 2.3 Theoretical Framework
  • 2.3.1 The Research characteristics
  • 2.4 Forecasting economic results for simulated agricultural modules (total profit and profit per hectare), 2013–
  • 2.5 Determination of agricultural modules’ budgets
  • 2.5.1 Underpinning crops’ rotation of the simulated modules
  • Chapter III Alternatives in Valuing The Agricultural Potential
  • 3.1 Designing a farming module with 60 ha surface, in lowland agricultural area
  • 3.2 Designing a farming module with 100 ha surface, in lowland agricultural area
  • 3.3 Designing a 250 hectare farming module, in lowland agricultural area
  • 3.4 Forecasting a module of farming to an area of 500 ha, in lowland agricultural area
  • 3.5 Forecasting a module of farming to an area of 800 ha, in lowland agricultural area
  • Conclusion
  • Bibliography
  • Appendixes
  • Appendix 1
  • Crop rotation for a 60 ha farm in a lowland agricultural area
  • Basically details in building a 60 ha farm in a lowland agricultural area
  • Appendix 2
  • Crop rotation for a 100 ha farm in a lowland agricultural area
  • Basically details in building a 100 ha farm in a lowland agricultural area
  • Appendix 3
  • Crop rotation for a 250 ha farm in a lowland agricultural area
  • Basically details in building a 250 ha farm in a lowland agricultural area
  • Appendix 4
  • Crop rotation for a 500 ha farm in a lowland agricultural area
  • Basically details in building a 500 ha farm in a lowland agricultural area
  • Appendix 5
  • Crop rotation for a 800 ha farm in a lowland agricultural area
  • Basically details in building a 800 ha farm in a lowland agricultural area
  • Appendix 6
  • Farms by economic types and size in Romania
  • Appendix 7
  • Agricultural products prices in agri-food market, 2006–2017
  • Appendix 8
  • Annual Budget For The Holding Of 60 Ha, 2013–2017
  • Appendix 8a
  • BUDGET OF 60 ha FARM IN LOWLAND AREA Basic variant – year 2012
  • Appendix 8b
  • BUDGET of 60 Ha Farm in Lowland Area Option at the End of the Forecasted Range – Year 2017
  • Appendix 9
  • Annual Budget for the Holding of 100 Ha in Lowland Area, 2013–2017
  • Appendix 9a
  • BUDGET of 100 Ha Farm in Lowland Area Basic variant – year 2012
  • Appendix 9b
  • Budget for the holding of 100 ha in Lowland area Option at the End of the Forecasted Range – Year 2017
  • Appendix 10
  • Annual Budget for the Holding of 250 Ha in Lowland Area, 2013–2017
  • Appendix 10a
  • Budget of 250 Ha Holding in Lowland Area Basic Variant – Year 2012
  • Appendix 10b
  • Budget of 250 Ha Holding in Lowland Area Projected Variant – Year 2017
  • Appendix 11
  • Annual Budget For The Holding of 500 Ha in Lowland Area, 2013–2017
  • Appendix 11a
  • Budget of 500 Ha Holding in Lowland Area Basic Variant–Year 2012
  • Appendix 11b
  • Budget of 500 Ha Holding in Lowland Area Option at the End of the Forecasted Range–Year 2017
  • Appendix 12
  • Annual Budget for the Holding of 800 Ha, 2013–2017
  • Appendix 12a
  • BUDGET of 800 Ha Farmin Lowland Area Basic Variant – Year 2012
  • Appendix 12b
  • Budget of 800 Ha Holding in Lowland Area Projected Version–Year 2017

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Introduction

To identify solutions meant to value the agricultural potential under optimal conditions as one of the fundamental issues in emphasizing the role of agriculture in the context of national economy by means of improving the results in this field and enhancing stability, predictability and sustainability of agricultural production.

In order to set and carry out a plan for vegetal agricultural production it is necessary to take into account a series of various endogenous and exogenous factors that production depends on, such as the availability and structure of land, crop plans and rotation, the capital and willingness to invest money, the labor force, the demand and supply for agricultural products, the environmental conditions, and not at least the production costs.

Valuing the potential of Romanian agriculture involves a comprehensive effort to develop coherent and perspective strategies by which to identify factors that may contribute to the sustainable development of this sector. Romania’s integration in the European Economic Area and its adaptation to the subsequent changing demands imply a redefinition of the entire national agricultural sector, but also the ways and means to exploit the available agricultural potential by referencing the appropriate national food policies to Common Agricultural Policy (CAP).

It is necessary to understand the current realities through which the CAP transforms itself, in the last time, in the object of political negotiations between the old and new members, assisting in a reorientation of its agricultural production to rural development, mutation that obviously not all members benefit especially the new states that have a significant, but weak and not adequately capitalized agricultural sector.

Agriculture is a vital sector of the national economy with wide influences on macroeconomic outcomes, contributing significantly to Gross Domestic Product (GDP) and Gross Value Added (GVA), while being a potential source of improbability value of these macroeconomic indicators.

Development of agriculture, over the 23 years of transition has highlighted the major role it has in the national economy, both in terms of contribution to the GDP, but by high levels of self-consumption. Evolution ← 7 | 8 → of agricultural GDP reflects statistical reality specific to transition process, the high proportion of this is not based on sustainable growth in agricultural production, but rather sharp decline and collapse of other sectors. Sizing artificial agricultural GDP share defines a specific reality of the Romanian economy, a disarticulation of economic sectors, and agriculture is a strong resonance box of instabilities generated by the mechanisms of formation the GVA in the economy.

Significant reduction in the contribution of agriculture to GDP over the analyzed period is the result of a lack of agricultural policies articulated, characterized largely by the dissolution of agricultural production structure and reduced accumulations in agriculture based on the lack of investment and inadequate use of available capital in this sector. In this respect, the share of agriculture in capital investment in fixed assets is significantly below the level of its contribution to GDP. Assessment of the contribution of agriculture to GDP in the Romanian economy is the result of significant failures of macroeconomic statistics. In fact, we can say that the role of agriculture in achieving GDP is somewhat flawed, and its contribution is far superior level highlighted, even if we take into account the evolution of the share of consumption of agricultural products from own resources, the monthly expenditure of households rural households and the farmers in particular.

Agriculture is the main activity in the rural communities of Romania, representing the only source of livelihood for a significant proportion of the rural population.

The transition to a market economy in Romania and implementation of strategies emphasized the sector reform and downsized national agricultural sector, contributing significantly to the creation and accentuation of serious economic and social imbalances that rural areas had either corrected or absorbed them.

Agriculture significantly transformed under the pressure of reform effects from a significant economic sector in a social shock absorber or rather a safety net for people in rural communities has faced with high unemployment and increased migratory flows from de-industrialized urban areas.

The observed effect represents a significant increase in the degree of ruralization trend. Although this level tends to stabilize in the last period, ← 8 | 9 → the share of rural population in total population in not the same of 44.9% after 2007, the value confirms not only the ruralism stressed of the Romanian society, but a distancing from the European socio-economic model.

Agriculture is equally an alternative employment of labor available in the economy, if we take into account that we find about 30% of the country’s working population in agriculture. Increasing the use of available labor in the agricultural production mechanism can actively contribute not only to improve the living standards of rural communities, but to reduce urban-rural disparities in Romania.

Equally, agriculture is the main element in supporting self-consumption and subsistence population, ensuring a minimum and precarious level of food security. Agricultural production is mostly geared towards meeting their needs for households and not for sharing and recovery in the market, such as is natural for a functioning market economy. Increasing proportions of counter food consumption highlights the precariousness of the stability and sustainability of the Romanian economy as a whole. Share equivalent value of agricultural products from own resources monthly expenditure of households is doubled by the share of agriculture participation to GDP, which is specific to other European economies in the eighteenth and nineteenth centuries.

Details

Pages
172
Year
2014
ISBN (PDF)
9783653050127
ISBN (ePUB)
9783653975048
ISBN (MOBI)
9783653975031
ISBN (Softcover)
9783631658260
DOI
10.3726/978-3-653-05012-7
Language
English
Publication date
2014 (November)
Keywords
Landwirtschaft Optimierung Produktionsmethoden
Published
Frankfurt am Main, Berlin, Bern, Bruxelles, New York, Oxford, Wien, 2014. 172 pp., num. fig. and tables

Biographical notes

Jean Vasile Andrei (Author) Gheorghe H. Popescu (Author)

Jean Vasile Andrei is Teaching Assistant at Petroleum-Gas University of Ploiesti (Romania), Department of Business Administration and Editor-in-Chief of International Journal of Sustainable Economies Management (USA) and Associate Editor of Economics of Agriculture (Ekonomika poljoprivrede). He holds a Ph.D. in Economics defended at the National Institute of Economics Research – Romanian Academy of Sciences. Particularly issues like business investments process, economic efficiency and valuing economic and natural potential are among his research and scientific interests. Gheorghe H. Popescu is full Professor at Dimitrie Cantemir Christian University, Bucharest (Romania). He is the Editor-in-Chief for three international peer reviewed journals as: Economics, Management, and Financial Markets, Journal of Self-Governance and Management Economics, and American Journal of Medical Research. Since 2012, he has been a senior research fellow at the Institute of Interdisciplinary Studies in Humanities and Social Sciences, New York.

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172 pages