Labour Drivers in the Agricultural Sector of the European Union

Abstract

The social role of the farms is, especially, relevant in the rural areas where the socioeconomic problems are, often, more visible. In this perspective, this study aims to investigate the interrelationships of the labour input with other variables inside the farms and assess how the sector may create more employment in a sustainable way. For that, the labour input was, first, correlated with other farm variables and after analysed through factor analysis approaches and cross-section econometric methodologies, considering as basis the Cobb-Douglas and Verdoorn-Kaldor models. The main findings highlight relevant insights to improve the social dimension of the European Union farms. The labour input growth rate is positively influenced by the total output growth rates and negatively impacted by the total productivity growth. The effects from the investment and from the subsidies are residual or not significant.