Agricultural Biodiversity and Land Fragmentation: the case of Bulgaria

Salvatore Di Falco and Ivan Penov
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Ivan Penov: Department of Economics, National University of Ireland, Galway

No 132, Working Papers from National University of Ireland Galway, Department of Economics

Abstract: This paper presents an empirical analysis of the role of land fragmentation, crop biodiversity and their interplay with farm profitability. Original primary date are drawn from a survey conducted in Bulgaria. We present two different estimation methods: Seemingly Unrelated Regression and Three Stages Least Squares. The econometric results stress the ambiguous role of land fragmentation on farm profitability. One one hand, land fragmentation reduces farm profitability. On the other hand, land fragmentation fosters crop diversification. Biodiversity also plays a beneficial role in farm profitability. Policies that aim to reduce land fragmentation may overlook the positive link between diversity and plot heterogeneity.

Date: 2008, Revised 2008
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