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CREDIT LEVEL INFLUENCING FACTORS AT HUNGARIAN FARMS

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Author(s): Toth Kristof | Toth Jozsef | |

Journal: Annals of the University of Oradea : Economic Science
ISSN 1222-569X

Volume: 1;
Issue: 2;
Start page: 533;
Date: 2012;
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Keywords: credit | output | collateral | subsidies | farm size

ABSTRACT
In this paper we estimate the impact of different factors on creditability of agricultural farms. According to the literature the collateral (tangible assets), the farm size, productivity, and subsidies should have significant effects on farm loans. We use data from the Hungarian Farm Accountancy Data Network to test our two hypotheses and theoretical assumptions for the period 2001-2010. Because of using panel data, we do our estimations using fixed effects econometrics model to test our assumptions. The results indicate that the chosen factors have significant influence on total liabilities and short- and long-term loans as well. With specially interest of subsidies the growing level of supports decrease the need of other financial tools. At output factors (inclusive farm size) have significant and positive effect, same as collateral (tangible assets).
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