Assessment of family farm characteristics and identification of the type of sustainable economic development: Lithuanian case

Abstract

Assessment of family farm characteristics and identification of the type of sustainable economic development is relevant as it enables the identification of the typological parameters that prevail in the farm groups. It can contribute to appropriate decision-making processes in relation to governance in order to support sustainable farming. The aim behind the assessment of family farm characteristics and identification of the type of sustainable economic development is to empirically identify the family farms in Lithuania by the type of sustainable economic development. The types were developed on the basis of the k-means clustering method. The method of descriptive statistics was used to calculate the variables used for establishment of the limits for subsequent determination of the type of family farm. Family farm accounting data for Lithuania were used in the study. The novelty of the study lies in the classification of the nine types of farms by three levels of sustainable economic development and economic efficiency of a farm (FSED-FEE): level I – same FSED-FEE level; level 2 – maximum difference between the FSED-FEE levels; and level 3 – minimal difference between the FSED-FEE levels. They were developed on the basis of the k-means clustering method. The comparative analysis of the three typological groups was conducted with the view towards the identification of the differences between the farm indicators at different level of development – low, medium, or high – of the farms. It also was aimed at identifying the attributes that prevailed at different farm development levels. The conducted empirical study has enabled the identification of the level of sustainability of the farms, comparison of the family farms to each other, and identification of the determinants and reasons thereof. The findings of the study may contribute to improvement of the common agricultural policy as well as the measures for promotion of sustainable development of agriculture