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Do subsidies drive productivity? Farm-level evidence from the Russian Far East
https://doi.org/10.32609/0042-8736-2022-2-120-146
Abstract
Do subsidies drive productivity at the farm-level? To address this question, we use farm-level data from the Amur region in Russia for 2010—2014. Using this data, we assess corporate farm production function and find no economically or statistically significant cumulative effect of state subsidies on total factor productivity within three years after the subsides were received. Our findings are robust to the choice of the production functional form, time period, and land measures. So one might conclude that subsidies to corporate farms in Amur Oblast serve primarily as a tool of income support not as a driver of the productivity change. Our research contributes to the discussion about the effects of state supports and subsidies on agricultural development, productivity, and market structure in Russia.
Keywords
agriculture,
subsidies,
total factor productivity,
corporate farms,
Russian agriculture,
the Russian Far East
JEL: D24, Q12, Q18, L22
About the Authors
O. G. Vasilyeva
Economic Research Institute, Far Eastern Branch of the Russian Academy of Sciences
Russian Federation
Russian Federation
Olga G. Vasilyeva
Blagoveshchensk
A. M. Bilko
Far Eastern State Agrarian University
Russian Federation
Russian Federation
Andrey M. Bilko
Blagoveshchensk
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Vasilyeva O.G., Bilko A.M. Do subsidies drive productivity? Farm-level evidence from the Russian Far East. Voprosy Ekonomiki. 2022;(2):120-146. (In Russ.) https://doi.org/10.32609/0042-8736-2022-2-120-146
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