ANALYSIS AND CONTROL OF GOVERNMENT SUBSIDIES FOR INVESTMENTS IN AGRICULTURE OF THE RUSSIAN FEDERATION

Abstract

Subsidies are an important part of development of agriculture in Russia. The vast majority of agricultural
holdings have negative profit margin without government support. Comparing an amount of government
support in Poland and in Russia, it was equal to 76.21 m PLN for 1,000 km2 of agricultural land in Poland
versus 6.35 m PLN in Russia in 2014. Such situation leads to low productiveness of agriculture in Russia.
As Russian agriculture is extensive, the Government has made a decision to assign about 40% of the
support amount to recover rate of investment loans intended for development of material and technical
facilities of agriculture. This program is not popular and it involves 3.55% of the total number of agricultural
holdings only. In order to estimate efficiency of utilization of subsidies a cluster analysis was made
by means of K-mean method. It revealed 3 clusters depending on efficiency of subsidies utilization. Some
control procedures are suggested to manage efficiency of utilization of government support.