Company succession and business start-ups in agriculture
Company succession and business start-ups in agriculture: opportunities, deficits and appraoches to solutions
The number of agricultural enterprises in Germany has been declining for many years. The role played by unsecured farm succession in structural change, also known as "farm death", and the relevance attributed to non-family farm transfers and business start-ups is being investigated in this project.
Background and Objective
The transfer of farms to the next generation ensures the continuity of agricultural enterprises, but in many cases it is not secure. Consequently, affected farmers are confronted with the question of the future of their farm or the possibility of giving it up. On the other hand, it is often difficult for interested parties without a family farm inheritance to find a production basis for an agricultural business start-up or a lateral entry. Access to land and capital is one of the greatest challenges for new and lateral entrants into agriculture, in addition to the increasing demands of society and changing technical legislation. Farmers, potential farm owners and new entrants are confronted with individual transfer or entry situations, the reasons for which have not been extensively researched.
For this reason, the aim of this research project is to address the various facets and contexts of the agricultural generation change in Germany and to identify opportunities, deficits and possible solutions. To this end, research will focus on the following three areas: the problem of the lack of business succession and its effects on the agricultural sector, the relevance of non-family farm succession and the significance of agricultural business start-ups.
The three areas of investigation are dealt with one after the other in the order mentioned above. In a first step, relevant literature contributions are analysed and suitable data sets, especially from the agricultural censuses, are statistically evaluated with regard to the farm succession situation in Germany. Then expert interviews are conducted with associations and advisory institutions in order to map the situation on the farms and to record the effects of enterprises without farm successors for the region or the sector. In particular, previously generated hypotheses with regard to farm characteristics such as farm size, type of business and farm assets and the decision to take over and give up farms are to be tested here and supplemented by further findings. Finally, the results of the study will be validated in a focus group workshop with experts and possible recommendations for action will be derived. In the two following research areas, a similar procedure will be followed, whereby the data will be collected mainly through a quantitative, written survey and, if necessary, supplemented by expert discussions and in-depth interviews.
The focus of this research project is on agricultural business succession and business start-ups in Germany. As a reference, other sectors, such as crafts, and other countries (selected EU Member States, Great Britain and the USA) will also be included for comparison.
Data and Methods
Due to the limited information and data available to answer the research questions and objectives, the collection of information and data is an important step in the research to be carried out and is to be carried out in the form of oral and written interviews. In addition, data from the agricultural structure statistics, especially the agricultural censuses 2010 and 2020, should be evaluated, possibly supplemented by data from the agricultural social insurance or the test farm network. Existing scientific theories of behavioural economics, investment theory, institutional economics and the agricultural household form the theoretical framework of this research.
Our Research Questions
- is there (from different perspectives) a farm succession problem in agriculture? If so, what implications can be derived from this for the agricultural sector?
- What is the relevance of non-family farm successions? What are their special features (structure, development, etc.)? What are the facilitating and inhibiting factors?
- What is the significance of business start-ups in agriculture? What are their special features (structure, development, etc.) compared to conventional farm takeovers? What are the differences between successful and less successful business start-ups? What are promoting and inhibiting factors?