Decision making pattern of subsistence farmers in Bulgaria

Acknowledgements This research was undertaken with support from the European Union's Phare ACE Programme. The content of the publication is the sole responsibility of the authors and it in no way represents the views of the Commission or its services. Abstract Economic research by and large is dominated by a 'rationality' paradigm. Economic decision making within this paradigm is viewed as a maximising procedure. In general the latter represents the decision-making as a choice amongst a well defined set of alternatives. In this paper we question this and analyse the options of the small-scale subsistence farmers in Bulgaria in the way they see them. By applying mental accounting methodology we deduce some significant characteristics of Bulgarian subsistence agriculture. Economic models often apply the view of economic rationality. The latter presents a specific characterisation of the decision problem and applies predetermined criteria to deduce the 'rational' choice. This paradigm of 'substantive rationality', although dominant in economic research, is insufficient to explain economic behaviour. When applied to real world problems, such as the discussed in this paper problem of subsistence agriculture, it leads to a conclusion that the economic agents behave unreasonably and that measures are needed to be taken to make them act 'rationally'. Such a view is however, untenable and we redefine rationality in a procedural context, that is, people are rational if they can list reasons for their behaviour. In the latter context, it is increasingly important to build an image of the 'world views' held by economic agents. Their action will be more dependent on the way they see the problem (the world view) than on the information they possess. The paper analyses the 'world views' of Bulgarian subsistence farmers and deduces several important characteristics of these. We elaborate on the origins and causes of these views and demonstrate their consequences for the economic choices of subsistence farmers. In this way we can not only explain some seemingly paradoxical situation like this how it was possible for Bulgaria in the presence of production surplus of tomatoes, to import tomato puree, but also to delimit the future behaviour of Bulgarian subsistence farmers.