Criteria for determining the ecologo-economic and economic efficiency of agricultural land use and for ensuring its sustainable development

Abstract

Against the background of present-day market relations, agriculture is gradually evolving into agricultural land use, whose sustainable development must be effective in terms of both economy and ecology while providing opportunities to integrate environmental policies into Russia’s strategy for socio-economic reforms. One issue has gained considerable relevance in this regard, i.e. the need to substantiate and improve the criteria for determining the ecologo-economic and economic efficiency of agricultural land use and for ensuring its sustainable development in the Republic of Crimea. The article examines the theoretical and methodological framework of agricultural land use, its essence, criteria and system of indicators. Scientific views of economists are given regarding the definition of the term “efficiency” that are part of the notion of criteria for assessing agrarian land use. These include the financial result owing to the use of natural resources in agricultural production activities; changes in ecology due to soil fertility and environmental health; and the ability to deal with seasonal variations of agricultural output related to agricultural specificities. An analysis was made of Russian researchers’ approaches to assessment of criteria for determining the ecologo-economic and economic efficiency of agricultural production. A relevance tree was drawn to represent the strategic objectives for ensuring the sustainable development of agricultural land use and a study was made of the different components of this relevance tree. The authors suggested a formula for calculating the ecologo-economic and economic efficiency (EEE) of the sustainable development of agricultural land use, which updates and enriches the methodological framework for its definition, exposed by the authors in economics literature. This formula takes into account the aggregate capital (AC), value-based human capital, increased gross value added as well as the impact of agricultural land use on the state of natural resources (land and water) and the environment. The suggested methodological approach was used as a basic set of criteria for determining the ecologo-economic and economic efficiency of the sustainable development of agricultural land use, which could enhance its sustainable development and contribute to environment conservation in agricultural entities of various types of ownership in the Republic of Crimea (see Annex for details).