Does cooperation lead to private farmers'

success? Findings from a survey in Kurgan

Region, Russia
Abstract
With the collapse of the socialist regimes the institutional environment for doing business had
to be changed. With respect to agriculture, one of the major outcomes had been the (re-)
establishment of private farming. In Russia, this type of farming was politically promoted.
Private farms were supposed to form the backbone of agricultural production. While there had
been an increase during the 1990s, they did not develop as anticipated. They still play a minor
role between the large-scale corporate farms, which are successors of the former socialist
farms, on the one side and household plot producers on the other.
Nevertheless, private farming seems to become stronger over the last years. While the number
of private farms has stagnated during the early 2010s at around 260,000 and seems to be
gradually declining during the last years, its share to total food production increased to about
10 percent in 2014. Similarly, average farm size rose to more than 160 hectares.
Since private farmers start from scratch there is no denying that they are in need of a
supporting infrastructure which similarly has to be set up from scratch. The set-up of viable
agricultural service cooperatives might be such an option. However, in most post-socialist
countries, no formalised collaboration among private farmers could be observed. It had been
argued that due to communist legacy farmers had a lot of scepticism. Alternatively, informal
networks might be helpful if the institutional environment is not supportive in establishing
formal forms of collaboration.
Based on a structured questionnaire data was collected in a survey conducted through
personal interviews. It took place in Spring 2015 within the Kurgan Region, Russia bordering
Kazakhstan. 167 private farmers had been interviewed. The analysis will be done using
descriptive analysis and econometric regression methods.
The empirical analysis tests whether the characteristics of farmers social network interactions
may explain the farm success, as measured by self-reported farm incomes. It has been
hypothesized that networks may connect farmers with each other. The findings show that
agricultural productivity per hectare of land is higher for those who belong to formal
institutions. This may indicate better access to farm inputs in cases where markets do not
provide sufficient access to various farm inputs. The transaction costs might be reduced
through social network collaborations.

Authors
Axel Wolz (Leibniz Institute of Agricultural Development in Transition Economies), Svetlana
Golovina (State Agricultural Academy Kurgan), Jerker Nilsson (Swedish University of
Agricultural Sciences, Uppsala), Sebastian Hess (Christian-Albrechts-Universitt zu Kiel)

Topic Area
Topic #4 Agriculture and Co-operatives

Session
OS-3B Agricultural Cooperatives No.1 (16:15 - Wednesday, 25th May, Palacio de
Congresos Sala 2)

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