Epsilon Archive for Student Projects

Abstract

The lack of engagement from young people in agriculture presents a significant challenge to the future of the agricultural sector and of food security globally. Despite numerous studies focusing on the motivations and barriers for young individuals to enter farming, there's a gap in understanding their investment behaviour past entry. This study addresses this gap by empirically examining the factors influencing investment decisions among young Swedish farmers after they have received the Setting up aid, between the years 2001 and 2020. This study uses a dataset covering 4230 Swedish farmers aged 16 to 45 who all received the Setting up aid. The empirical analysis is based on logistic regressions and the purpose is to examine the factors that influence receivers of the Setting up aid to make additional investments. Results indicate that age is an important factor, suggesting a quadratic relationship and that the propensity to invest peaks at around age 30. Furthermore, individuals that received investment support in connection with the Setting up aid where associated with an increased probability of making future investments, but the magnitude of the initial investment support is indicated to decrease this probability.
This study contributes to the literature with empirical evidence on factors influencing young farmers investment behaviour, offering insights for policymakers to better design more effective supports for young farmers. Ultimately, by understanding and addressing the challenges facing young farmers, is crucial to ensure the sustainability and competitiveness of the agricultural sector in the face of evolving market conditions and environmental pressures.