Policy of Small Farms Subsidizing in the Function of Economic and Social Development of Villages in Serbia

Before the subsequent process of economic transition from a socialist to a market economy, over 80% of arable agricultural land in Serbia has been in private hands. State and social ownership, before privatization, existed in large agricultural complexes. The right of private ownership of agricultural land was limited to 10 ha in the plains and 20 ha in mountainous areas. The economic reforms over the past 10 years have led to a process of enlarging properties. Small and medium-sized farms and 10 ha of land present the factor that absorbs a part of rising unemployment caused by privatization and restructuring of social and state-owned enterprises in Serbia. The state economic policy is focused on the subventions of small farms through incentives for the purchase of equipment, seeds, energy, and protection of resources. The increase of economic efficiency of small farms is an important factor of development. The maintaining the level of economic survival of small farms has an important demographic and social function. The demographic is reflected in the sustainable density of population in certain areas of the country. The social function is important from the standpoint of the struggle against poverty and unemployment.