The role of public subsidies for efficiency and environmental adaptation of farming: A multi-layered business model based on functional foods and rural women

This paper examines the role of public subsidies on farming efficiency for Spain by using a Data Envelopment Analysis (DEA) approach followed by a nonparametric regression of efficiency to farm specific factors (economic size, environmentally friendly behavior and regional aspects). The empirical analysis suggest that although a higher degree of direct payments negatively affects farm efficiency, these subsidies become an incentive for environmental friendly behavior by farmers in order to improve the productive efficiency. In turn, this proposition leads to a careful attention for the roots of agricultural productions in line to the EU aim of more market-oriented agriculture. Then, a conceptual framework was elaborated in order to propose a multi-layered model for supporting the design of a green business plan based on functional foods. This study also explores the process of generation-production-consumption of functional foods, involving not only the knowledge transfer of the healthy properties of these products but also the multiple role of rural women as producers, educators/advisors and buyers of these foods. The positioning of rural women in the whole process of functional foods results relevant to build their competitive advantage as local entrepreneurs. The leverage points of the strategic formulation of green business models were reinforced following the roadmapping methodology from a dynamic perspective: alliances with suppliers of knowledge (researchers), identification with their reference groups (investors, clients) and management of intellectual capital (structural, human, relational). Finally, findings reveal that rural women are better positioned than others to create businesses based on functional foods from a niche formulation.