Impacts of transregionally active investors in agriculture on rural areas

Background and Objective

In East Germany an increasing number of agricultural corporations have been taken over by external investors through so-called Share Deals, that is through buying shares of the company. Earlier studies have shown that between 2007 and 2016 about 2% of the agricultural land have changed owners through such Share Deals. In most cases, investors are non-agricultural businesses or entrepreneurs, they stem from other regions, and often own several agricultural businesses.

Critics fear that these changes will negatively affect the rural economy and farm structures, and claim for legal regulations of Share Deals.

So far it is unclear if, and in which ways, transregionally active investors with regard to their behavior and impacts really differ from other agricultural enterprises. Thus, the project seeks to investigate if the fears are justified.

Approach

The research will follow a case study design. Case studies are

1. Agricultural businesses (holdings) which are owned by transregionally active investors;
2. Communities in which such businesses are active.

The business case studies aim to describe and analyse transregionally active investors (their philosophy, strategies, the supporting conditions of their expansion, etc.).

The community case studies shall demonstrate how these businesses behave in a concrete local context, what outcomes follow from this, and how these businesses are perceived by local actors.

Data and Methods

Case studies will follow a mixed methods approach and will draw upon various sources, such as:

• Interviews with decision makers, local actors and experts,
• Document Analysis (Media reports, official business statements and publications),
• Official statistics (Tax, Employment, Land use etc.).

Our Research Questions

1. Which effects do transregionally active investors have on the local economy (value added, employment, etc.), the quality of life and the environment in rural areas?
2. In how far do certain types of investors differ regarding their attributes, behaviour and their impact on rural areas?

Results

The research concept was successfully tested in two regional case studies in Mecklenburg-Western Pomerania and Brandenburg. As a result, a model for analysing economic, soial and political fields of interaction between agricultural enterprises and rural communities was created. Moreover, crucial issues were identified which deserve closer examiniation.

As it was expected, the number of two case studies is not sufficient to deduce any general statements with respect to the research questions. Our research will therefore continue in the project "WiSoLand".