This study investigates the extent of land fragmentation in Bulgaria, where it is considered a major agricultural and land reform issue. Using data from the Bulgaria 2003 Multitopic Household Survey as well as other data sets pertaining to late 19th and early 20th century, the paper shows that the current level of land fragmentation is low-to-moderate in Bulgaria and that fragmentation is at its lowest level in about a century. This finding is in contrast to some of the existing research which has suffered from measurement problems. The paper underlines the significance of differentiating between land fragmentation and farm size to reveal an accurate portrayal of the extent of land use.
Land fragmentation is considered a major obstacle to the efficient use of land and other agricultural resources in Bulgaria. This study is concerned with formally testing the relationship between fragmentation of land plots and land productivity in the country. Multiple regression analysis and agricultural data obtained from the 2003 Bulgaria Multi-topic Household Survey is employed for the purpose. Results of the study suggest that the level of current fragmentation is relatively low and not likely to adversely affect land productivity. Other conditions being equal, therefore, land consolidation may not lead to any significant improvement in productivity in Bulgaria.
Partible inheritance, alone or together with population growth, is widely assumed to be the fundamental cause of land fragmentation in Bulgaria. This study questions the explanatory power of these two supply-side causes of fragmentation. Relying on historical sources and an analysis of historical agricultural census data, the article presents evidence that partible inheritance and population growth are unlikely causes of land fragmentation. The study also traces the development of land markets to establish the purchasing behaviour of farmers. It reveals documented high demand for scattered plots of land in the years before Liberation from Ottoman rule. Attention is drawn to demand-side factors such as the risk aversion of farmers and optimization of self-employment, among others, as the likely fundamental causes of fragmentation. The article suggests that the possible endogenous nature of fragmentation in the country must be taken into account when policies are designed to target its undesirable aspects.
This work investigates and compares the total risk attributable to holding and operating companies, using data from the United States. By proxying overall risk by the option-adjusted spread on corporate bonds, we hypothesize that operating companies face a higher risk. Our data were obtained from Bloomberg and comprise 17,800 corporate bonds. Our methodology entails stratified univariate comparisons of the means of the option-adjusted spreads of sub-samples of operating companies versus holding companies. The principal bases of stratification are issue size, bond maturity, and creditworthiness proxied by the Standard and Poor ratings. With very few exceptions, our results report insignificant t-statistics, thus making us unable to reject the null hypothesis that the operating companies have the same business risk as holding companies. When bond rating, maturity, and size are controlled, there is no consistent cost reduction attributable to holding companies, and contrary to common belief, this is more visible for smaller firms. Our work suggests that there is no evidence consistently favoring holding-company financing compared to operating ones.
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