The paper deals with the evaluation of the impact of capital investments on the value added in Latvian dairy specialization farms on the basis of FADN data. The evaluation is carried out through analysing the current level of capital investments in Latvia and the link between capital and the net value added and its main components, based on the comparison with the EU leading milk producing countries. The analysis shows that the current level of capital investments is low in Latvia, especially in buildings and fixed equipment. Insufficient capital investments result in high intermediate costs, lower labour productivity due to large labour contribution in the total output, and also in considerably lower level of the value added, especially per AWU in Latvia.

The study summarises the theoretical and legal aspects of the main types of area payments in Latvia. From the point of view of theoretical and legal arrangements, the area payments may be broken down in two large groups: direct payments and area payments foreseen under Rural Development Programs. The legal package regulating Area Payments consists of the EU regulatory enactments (Council or Commission Regulations) and regulatory enactments of Latvia (Laws and the Cabinet (MK) Regulations). The institutional implementation system of each group of Area Payments is relevant and distinct. The present study analyses 11 different types of Area Payments. Over the period 2004 - 2007, farmers have received LVL 430 million in different Area Payments constituting 58.5% of the total amount of support.

In this study the development of meat sector in terms of livestock population, production, farm size and reproductive material, which forms economic basis for effective meat production was analysed. The aim of the study was to investigate main tendencies of meat production sector and development of economic basis in Latvian agriculture. To achieve the set aim following objectives were defined: 1) to analyse concentration and specialization processes of pig breeding farms; 2) to describe restructuring processes of reproductive pig breeding; 3) to investigate restructuring processes of farms producing beef; 4) to characterize concentration and integration processes in poultry production. The study was based on annual statistical data and statistical bulletins covering results of the Farm Structure Survey from 2001 to 2006, scientific publications, special literature and reports of international organizations. To carry out the research adequate research methods were used. The results of this study showed that meat industry has structurally changed in recent years, where the structural change can be defined as the change in the number and size of farms in pig, cattle and poultry sectors. The results also suggested that meat production sector in Latvia has become more intensive, concentrating meat production in large and specialized farms, where this tendency can stimulate the increase of meat production. Therefore, knowledge of the current tendencies and strategies of pig, cattle and poultry sectors is a necessary precondition for the development of the meat sector.

Latvia is a territorially small country with small open economy, and its main and the most competitive recourses are highly educated society and well developed science which is based on research, innovation and modern technologies. To create a well functioning innovation system as a part of knowledge-based economy, several conditions has to be met to insure that all parts of national innovation system effectively work together. This article is dedicated to analysis of financing mechanisms that can be used by research institutes in the field of agriculture in Latvia to ensure sustainable rural development. The research in the field of agriculture in Latvia is mainly performed by the state research institutes and research agencies of Latvia University of Agriculture. To provide favourable environment for development of research and science, there is set legislation framework and financing mechanisms such as base financing from the state budget, state research programmes, European Commission Framework Programmes, and the European Union (EU) Structural Funds assistance. The analysis has shown that support of EU Structural funds has positive impact on number of applied research carried out in research institutes in the field of agriculture in Latvia. EU Structural funds assistance helps to develop fundamental research activities and innovative approach to the science that is one of the preconditions for the development of states' competitiveness. In conclusion, the authors resume that it is necessary to establish a strong link between higher education institutions, research institutes, and entrepreneurs in the process of building effectively working national innovation system.

The objective of the research paper is to explore the competitiveness of Latvian dairy sector from the aspect of productivity and export indicators, as well as to examine some of the possibilities to improve the sector competitiveness. The authors explore the productivity and export indicators of Latvian dairy sector, and the link between productivity and export (within the EU context), as well as analyse the impact of farm investment support within RDP 2007 – 2013. Value added per labour unit has been chosen as the productivity indicator; suitable qualitative and quantitative research methods have been applied to the studies. Based on the introduced indices of relative position of dairy industry productivity and exports, dairy processing in Latvia has strong inter-branch position in the domestic food industry. However, the inter-country comparison shows that Latvian dairy processing is behind the EU average level, when its productivity and export volume are considered. It has been found that productivity and export of dairy processing are positively related; rather strong positive correlation also exists between productivity in dairy farming and dairy processing. Therefore, the development of Latvian dairy sector, which mainly depends on the development of exports, can be more successfully achieved by the increase in its productivity; and relatively the largest productivity gap to close is in the dairy farming in Latvia. The direct investment support effect on NVA/AWU of dairy farms is found to be significant and positive, indicating that farm modernisation support of RDP 2007 – 2013 has facilitated the improvement of overall dairy farm productivity in Latvia.

Lease of farm lands is the most important process of proprietorial changes in the state’s agriculture sector. As an effect of turbulent socio-economic conditions and legal solutions resulting from country’s agricultural politics, its share in land’s management has significantly shrunk. Currently there is around 1.1 million ha of land in lease, which makes up for 23% of the land acquired by the Agricultural Property Agency of the State Treasury. After 23 years of 3.2 million ha of lands acquired by the Resource (68.5%) has already been managed permanently and 2.5 million ha (53%) have been sold. Lease allows fast temporary management of the farm lands acquired by the State’s Treasury, and a buying- out, mostly by the hitherto leaseholders, afterwards. The range and the structure of area of sales agreement of farm lands indicates that it was acquired by a relatively small group of buyers. Such a structure of permanent management of the State’s Treasury’s farm lands might bring some hesitations and questions on rationality of the proprietorial changes from the social interest view and ethics.

The productivity and its performance is one of the core topics of economics studies. The growth of productivity is an indicator of competitiveness, as well as a possible way to achieve economic growth and wellbeing. After joining the EU, the agriculture of the Baltic countries faced increasing competition of the EU Single Market, while having relatively lower productivity indicators. Since 2004, significant structural changes have taken place in the agriculture of the Baltic countries, and it is a topical question whether these changes and overall trends in the agricultural sectors of the Baltic countries have facilitated to increase productivity. Therefore, the objective of the study is to evaluate the productivity growth of the main production factors and the total factor productivity growth in the agriculture of the Baltic countries between 2004 and 2015, in relation to the changes in the use of the production factors. The paper focuses on the value added as output, and land, labour and capital as individual inputs to obtain partial productivity measures. The evaluation of TFP is based on the Index number approach, where TFP growth is a ratio of the Output index to the Input index. The calculations and analyses show that since 2004 both the agricultural output and value added have increased in the agriculture of the Baltic countries, and also productivity performance has improved.

The objective of this article is to assess farm efficiency and productivity change in specialised large farms located in the region of Mazowsze and Podlasie during the years 2014 − 2016. For this, we used the non-parametric Data Envelopment Analysis (DEA) method and Malmquist index. Calculations were performed for three types of large farms classified as: field crop, pig and dairy. The study shows that mean technical efficiency of large field crop, pig and dairy farms amounted to 80, 75 and 70%, respectively. Technical inefficiency of field crop farms come mainly from scale efficiency, while of pig and dairy farms equally from pure technical and scale efficiency. It shows that inefficient management practices had an impact on farm performance. Therefore, in order to increase competitiveness of farms, an improvement of management practices is required. In the studied period the share of farms operating under increasing return was as follows: 67, 72, and 81%, respectively for field crops, pig and dairy farms. The improvement of efficiency of those farms could be achieved by increasing their size. The results indicate that 8% of field crops, 12% of dairy and 16% of large pig farms were operating under decreasing scale efficiency, which means that those farms were operating above the optimal scale. The increase in their efficiency could be achieved through size reduction. In dairy farms the average annual productivity growth of 2% was recorded. In pig farms the productivity reduction of 5.4% was observed. It was the result of a decrease in technological efficiency.

The results of synthesis and analysis regarding the structural diversity of farms, their differences, divergence and development in Jelgava district and Zemgale agricultural region are expanded in the article. Commercial farms and semi-subsistence farms are particularly studied on the basis of farm accountancy data.

Analysis of statistical reports provided by the Statistical Department of Lithuania shows that a rapidly increasing number of agricultural enterprises are using computers for the preparation of documents and processing of accounts, and the internet for sourcing information and sending correspondence to business partners and other institutions. There is also a steady increase in the number of a-services, such as transference of payments, which are available via the internet. To identify the needs of agricultural specialists and rural citizens for e-services, a survey of available on-line services and potentially necessary e-services was carried out in August 2004. On the basis of these responses, the e-services of most importance to agricultural institutions and rural citizens now and in the near future were identified. These results also could be useful for other newly-joined EU countries of central and Eastern Europe.