The Impact of Agricultural Knowledge Transfer Resources on Farm Level Profitability during the Economic Recession – A Quantitative Study

Purpose: The outcomes from agricultural knowledge transfer (KT) are dependent on the access to and the quality of services available, coupled with the motivation of prospective clients to implement new skills. Within this context, the allocation of resources particularly in terms of the location of KT offices and number of agricultural advisers are important considerations for understanding KT impact. This quantitative study evaluates the impact of the rationalisation of KT resources on farm profitability for KT clients in Ireland during the recessionary period 2008-2014. Design/Methodology: Teagasc, the public KT service provider in Ireland, experienced significant office closures (43%) and staff reduction (38%) during the economic crisis, yet client numbers declined only slightly (4.5%). Administrative data is merged with a panel data set on farm level performance to test the impact of KT through Random Effects estimation. Findings: The results show that annual contract holders gained a 12.3% benefit to their market gross margin per hectare over the period. However, there was a negative effect of 0.2% for each additional client assigned to the adviser which averaged at 9.6% per adviser. Practical Implications: The quantitative findings provide a measure of impact that represents the value for money for the KT service. The key implication is that the client ratio for advisers should be considered when allocating resources and lower ratios would positively impact client margins. Theoretical Implications: This article outlines the value of quantitative studies to estimate impact in a clear translatable manner which can aid the policy discussion around resource deployment particularly in a recessionary period. The employment of a Random Effects estimator on a panel data set provides a solid base for the analysis. Originality/Value: This study evaluates the impact of KT on farm level profitability during a recessionary period when resources were constrained, and uses spatial variables and client densities to examine the regional effects