An Analysis Regarding Trends of Dualism in Korean Agriculture

농업생산 양극화 추이에 대한 연구

Purpose - The structural changes of Korean agriculture are complex due to heterogeneous production processes and farms' features. This study analyzed trends of dualism in Korean agriculture over the period 2000-15 based on farm-level data to clarify the specific trends of dualism in terms of farm income, farm-size, and farm operators' age. From the results of this study, we would be able to understand the features of structural changes in Korean agriculture more profoundly. Research design, data, and methodology - We incorporated farm-level data in South Korea: Agricultural census and Farm household economy survey. As measures of inequality, we used size-weighted quantiles, and normalized Gini coefficients as well as mean and conventional quantiles. The size-weighted quantiles are more robust to changes in the number of small farms, but they are more sensitive to changes in the distribution of farm-size. Thus, they would be more useful to identify trends of dualism of Korean agriculture. Results - The results show that the farmland distribution of crop farms became more skewed and dispersed. However, the herd distribution of livestock farms became more concentrated. To be specific, their mean and 1st quantile increases more rapidly than their size-weighted 2nd quantile and size-weighted 3rd quantile. Gini coefficients of livestock farms regarding their herd distribution decreased by 0.1 on average. In the case of income distribution, the results indicate that the polarization regarding farm household/agricultural/non-agricultural income became more severe. However, we also found that the distribution of transfer income became concentrated continuously. The results imply that transfer income including subsidies would decrease farm income polarization. Lastly, during the study periods, Korean farms were aging over time, and age distribution of them more concentrated. Conclusions - The structure of Korean agriculture has been changing, even though the absolute size of it decreased over time. Land (herd) distribution became more dispersed (concentrated). Inequality regarding agricultural income became more severe, and it made farm household income more polarized even though transfer income would decrease income gaps among farms. Lastly, farms continue to age regardless of farm types and this might affect the structural changes in Korean agriculture in the future.