The Relationship between the Effectiveness of Production Factors and Business Performance in Agriculture

  • Martina Novotná University of South Bohemia in České Budějovice
  • Jaroslav Svoboda University of South Bohemia in České Budějovice
Keywords: Efficiency, Productivity (one-factor, total factor), Return on Assets (ROA), Agricultural enterprise


The effectiveness of production factors can be evaluated against several relations, which must always be understood as relations between output and input. The aim of this paper is to assess the relationship between the effectiveness of production factors and business performance. One-factor productivity (more precisely labour productivity), total productivity (TFP)- on the basis of economic profit and Return on Assets (ROA) – the most synthetic indicator of profitability, were the applied indicators at approx. 820 agricultural enterprises. In the reference period (2004 – 2010) it was possible to describe the impact of the Czech Republic´s accession to the European Union on the selected agricultural enterprises. The agricultural enterprises system was further classified according to several criteria to verify the assumption that enterprises with higher efficiency of production factors have a higher Return on Assets (ROA).