1 Joint UNECE/EUROSTAT/FAO/OECD Meeting on Food and Agricultural Statistics in Europe Rome, 29 June-1 July 2005 INVENTORY OF AGRICULTURAL HOUSEHOLD INCOME STATISTICS

2 Survey on definitions and measurement issues in selected countries Income statistics for selected countries and case studies of good practice in applied methodologies

3 Survey on agricultural household income statistics - By end of June EU countries and 25 non-EU countries replied. - Questionnaire sent to UNECE countries plus OECD countries that are not members of UNECE in March 2004 Two different mailings - to EU member countries with request to update the information held and provide any information on changes that have taken place since the Income of Agricultural Household Sector report (Eurostat, 2002) - to non-EU countries with request to fill in questionnaire and provide any additional information available

4 Survey on agricultural household income statistics 20 EU countries have replied: Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Poland, Portugal, Slovakia, Slovenia, Sweden, United Kingdom 25 countries that are member states of the UNECE and/or OECD but not of the EU have replied: Albania, Andorra, Armenia, Australia, Azerbaijan, Belarus, Bulgaria, Canada, Croatia, Georgia, Japan, Kazakhstan, Kyrgyzstan, Mexico, New Zealand, Norway, Republic of Korea, Republic of Moldova, Romania, Switzerland, The former Yugoslav Republic of Macedonia, Turkey, Turkmenistan, Ukraine, United States of America

5 Survey on agricultural household income statistics The questionnaire 1. Definition of a household, agriculture household and rural household 2. Criteria for classification of households into socioprofessional groups 3. Mechanism used to introduce short term stability in num. of ag. hholds 4. Treatment of forestry and/or fishery households. 5. “Broad”definition of an agricultural household. 6. Treatment of non personal form of institution in the household sector 7. Treatment of holdings operated as corporate institutions but de facto run as family businesses 8. The equivalence scale used to give consumer units. 9. The basis of estimating the value of own consumption 10 The basis of calculating the imputed rental value of own dwellings 11 Calculation of Net Disposable Income of Agriculture Hholds.

6 Survey on agricultural household income statistics Survey on agricultural household income statistics Definition of household How the household is defined is important to understand the survey’s coverage of the population and when cross-country comparisons have to be done.

7 Survey on agricultural household income statistics Survey on agricultural household income statistics Definition of household Most commonly used criteria co-residence (living together in the same dwelling unit), pooling of income and resources, sharing of expenditures, including joint provision of essentials of living such as food existence of family or emotional ties.

8 Survey on agricultural household income statistics Definition of household: EU countries 11 EU countries use the definition used in the IAHS and originally stated in the European System of Integrated Economic Accounts (ESA). People living in the same accommodation, with a shared budget and who consume certain types of goods and services, e.g. food, collectively. People do not have to have a family link. - not all definitions have a reference to shared food - in Austria, Belgium and Denmark a family link between members of the same household is necessary - Estonia, Latvia, Slovenia and Sweden provided a definition very close to the one stated above. -in UK ‘households’ are individuals as the definition is linked to the tax system

9 Definition of household: Non-EU countries The co-residence criterion is used by all the 18 countries that provided a definition of household, with the only exception of Andorra that is also the only country to require members of the household to be part of the same family. The definitions used in Canada, Norway and the United States do not refer to shared budgets but only refer to sharing a dwelling unit.

10 Survey on agricultural household income statistics Definition of agricultural household “Narrow” definition ‘agricultural households are those where the income from independent agricultural activity, net of capital consumption, constitutes the main source of the total income of the reference person’

11 Survey on agricultural household income statistics Definition of agricultural household: EU countries ‘Broad’ definition: ‘agricultural households are those that derive some income from independent activity in agriculture (other than income solely in kind). This income can arise from activity of the head of household or any other member”.

12 Survey on agricultural household income statistics Definition of agricultural household: EU countries Ten countries (Denmark, Germany, Greece, Hungary, Ireland, Italy, Lithuania, Netherlands, Poland and Sweden) use the narrow definition of agricultural households. Five countries stated that no definition of agricultural household is used (Estonia, Latvia, Luxembourg, Portugal, Slovakia).

13 Survey on agricultural household income statistics Definition of agricultural household: non- EU countries The majority of the countries gave a definition closer to the broad target definition in the IAHS Manual, than to the narrow one Reference is usually made to the income of any household member rather than to that of the reference person being involved in agricultural activities.

14 Survey on agricultural household income statistics Survey on agricultural household income statistics Conclusions oThe results of the survey show that there are many differences in the concepts, definitions and coverage used by countries in defining the income of agricultural households. oIt might be argued that such flexibility of detail is needed to reflect differing socio-economic conditions, although these differences make cross-country comparisons difficult.

15 Problems of availability: Data on global farm hholds income are not systematically collected definition too narrow the farm hholds sample too small farm income uderestimated (income in kind not taken into account) Problems of comparability: different definitions of households differences in the definition of income and their components

16 What can be done in EU countries? The main statistical sources that can be used are farm account surveys, administrative data (taxation), national Household Budget Surveys and the Statistics on Income and Living Conditions (EU-SILC). Administrative data are not easily exploitable, in addition in some countries the available information do not allow to reconstruct the agricultural household income due to the special taxation regime applied to small farms (estimated agricultural income). Household Budget Surveys and EU-SILC survey do contain data on global income of agricultural household, the problem is that the coverage of farm households is usually too low to produce a statistically significant sample.

17 Background The survey exercise in March 2005 Developing country selection criteria LSMS and & or WCAP Data access Policy The need for statistical data on agricultural populations World Census of Agriculture: > 100 countries Living Standard Measurement Study: > 30 countries

18 Living Standard Measurement Study Household Surveys Characteristics: –Several questionnaires; –Small samples; Challenges: Inadequate household survey data; Adaptaing the LSMS process; Disappointments; Intra-household allocations.

19 Definition of Household

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21 Own Consumption Collection of Data on the value of home- produced food Imputing Values Imputation difficulties Food as imputed item

22 Calculation of net disposable income of agriculture households Entanglement of personal and business accounts Practical way to estimate income Seasonal variability of The income of households Consumption smoothing

23 Income statistics for selected countries and case studies of good practice in applied methodologies: –Farm household surveys United States Italy Canada –register based agricultural income statistics: Denmark and Sweden –European Union -Income from Agriculture Household Sector (IAHS) statistics