*KCI등재*

*학술저널*

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*The Optimal Rate of Subsidies on Smart Greenhouse Farming System Installation Costs*

- Won Seok Lee Hyun Seok Kim
- 한국농업경제학회
- 농업경제연구
- 62권 3호
- 등재여부 : KCI등재
- 2021.09
- 251 - 265 (15 pages)

This study derives the optimal subsidy rate on the installation expenses of smart greenhouse farming system (SGFS) to maximize farm income. To derive the optimal support rate, this study determines the adoption rates of SGFS by the rate of subsidy using TOA-MD model, and estimated the price flexibility of tomato using inverse demand function. The adoption rate of SGFS by tomato farms at the current price level increases rapidly with 50% to 100% subsidy rates. The estimated the price flexibility coefficient of tomato is -5.12 which implies that 1% increase in tomato production induces 5.12% decrease in the price. Using the determined SGFS adoption rates and the estimated price flexibility of tomato, this study finds that the changes in farm income by adopting SGFS gradually increase from 35,210,000 KRW/ha without subsidy to 38,420,000 KRW/ha with the 55% subsidy rate, then the farm income changes rapidly decrease and turn to negative at the 73% subsidy rate. Hence, we can conclude that the optimal support rate on the SGFS installation costs is 55% to maximize farm income.

Ⅰ. Introduction

Ⅱ. Methodology

Ⅲ. Data

Ⅳ. Empirical results

Ⅴ. Conclusion