Income or Assets—What Determines the Approach to the Environment among Farmers in A Region in Poland?

Abstract

The theory about the impact of farm size, income and assets on the environmental approach of farmers is ambiguous. We contribute to the existing discussion in two ways. Firstly, we look for the determinants of the environmental approach. Secondly, we treat farm size as a heterogeneous factor, affected not only by the value of assets but also flows of incomes. The main objective of the article is, therefore, to recognize the impact of assets and income on the environmental approach of agricultural producers. We analyze the results of surveys carried out in 2020 on a group of 120 farms from the Wielkopolska region (Poland), using structural equation modelling (generalized structural equation modelling (GSEM)-multiple indicators and multiple causes (MIMIC) model). Our results indicate that both the income and assets of the agricultural producers have a positive impact on their approach to the environment. However, to a greater extent, the farmer’s approach to the environment is influenced more by income than by assets. This may be influenced by the capitalization of subsidies in the price of agricultural land, which makes this element of farm assets detached from real processes. It is easier for farms with a higher income and assets to realize the orientation towards sustainability.