Diversification of activity in the Romanian family farms.

Radical changes in trends at European level towards diversification have led toconsideration of income improvements based on diversification of activity at farm level as an urgentsolution to the problem of poverty. Diversification of economic activities at farm level, aiming toincrease farmers' income from sources other than conventional agricultural production, could be apossible response to the ongoing changes of economic circumstances. Farm activity diversification isevaluated at farm level. Diversification refers to the creation of other gainful activities directly linkedto the activities that are carried out on the farm, but which do not include any activity related toagricultural production on the farm, i.e. they use the resources or products of the farm and have aneconomic impact upon the farm. Diversification implies a certain type of entrepreneurial activity forthe farmer’s benefit and reflects the diminution of farmer’s dependence on agriculture, as singleincome source. Diversification of economic activities in the Romanian farms by practicing nonagriculturalincome generating activities (micro-production, crafts, handicrafts, tourism and ruraltourism, etc.) indicated a positive effect on the development of multifunctional farms with diversifiedactivity that may be considered as a viable alternative for subsistence and semi-subsistence farming.The Romanian farms that had developed other income generating activities represented 31.7% of allsemi-subsistence farms, and 6.7% of total agricultural holdings. The study confirms that larger farmsare more likely to have resources, flexibility and, perhaps, entrepreneurial management, enabling themto explore opportunities for diversification.