Living Standards Measurements Study - Serbia 2002 - 2007

The physical capital of agricultural households
has a high impact on their poverty, but LSMS data
does not reflect that dependency. The survey does
not gather data on the state and quality of soil,
livestock and mechanization, which would make
conclusions on physical capital relevancy to
agricultural household vulnerability more reliable.
Simple ownership of land and/or livestock is not
correlated with agricultural household vulnerability:
99 percent of the poorest and 98 percent of the
richest farms own land. Such a situation is expected
considering the fact that land ownership, per se,
without adequate machinery and applied agro
technique measures is not a precondition for higher
income. In addition, the land market is not dynamic
and leasing does not provide always significant
income, especially to small farms. Further, some
land is not used by agricultural households due to
poor quality, inaccessibility, expensive production
and lack of machinery etc.
Data on the share of arable land of the total
area of the poorest farms is significantly lower than
that of the richest (68 compared to 89 percent)
supporting the fact regarding greater poverty
dependency on the quality of resources. Renting
land contributed to the improvement of farm
economic status. The percentage of farms that rent
land is higher within the 3rd and 5th quintiles (15
percent) compared to other quintiles. Generally
speaking, although land ownership per se is not
closely connected with poverty, the size of land used
is: farms that are below the poverty line have the
average-size farms of 3.30 hectares, and those
above the poverty line of 5.06 hectares. A similar
relation is also valid regarding possession of
animals and number of head owned by farms
(Graph 10). A larger percentage of farms (up to the
3rd quintile) own livestock of all kinds, while up to
a third of the richest ones do not breed animals.
However, the average number of head of some
species is constantly growing from the lowest to the
highest quintile.
Possession of agricultural machinery and
equipment is equally distributed among quintiles of
consumption, excluding the poorest farms with the
least agricultural machines. The biggest farms are
well-equipped with machinery. Farms within the 4th
quintile are those with best machinery, which is
expected considering the higher relevancy of
agriculture to their total income.
Graph 10.10. Physical capital availability by quintiles of consumption
Percent of farms
100
90
80
70
60
50
40
30
20
10
0
The poorest 2 3 4 The richest
14
12
10
8
6
4
2
0
No. of head by farm
Quintiles of consumption
Possess animals Possess cultivable land (%) Agricultural land, ha Dairy cow Pig
Agriculture
143