Financial aspects

In RegMAS models investments require liquidity that can be obtained using open-credit line that can grow up to a model-fixed share of the capital (e.g. 80 Each year the farmer optimize the quantity of money to ask to the bank. There isn't an end-term for farmers to give back the money as the ''bound`` is rather as the debit share of the capital.

Differently from AgriPoliS there is no difference from short-term loans and long-terms one. This is because loans are completely decoupled from investments. On the other side, there is no needs to assume a constant share of investment covered by the loan: the individual farmers are free to implicitly optimize the share of the investments covered by loans depending on their financial situation.

Liquidity is calculated as follow:

$$liquidity_t = liquidity_{t-1}+profits_{t-1}$$

$$-withdraws_{t-1}-\sum_{n=0}^{N}{invCosts_{t-1,n}}-sunkCosts_{t}$$ (1)

To calulate the liquidity available to farmers on a specific year we sum to the liquidity available on the previous year all the revenues (profits) and costs (withdraws and new investments) occurred in the previous year and we detract the sunk costs farmers need to pay before producing (these are costs generated from prevoius choices, like multi-year rental costs or investment maintenance costs).

Withdraws are the money required by the farmers to support their own private life. They are calculated as a fixed portion of the profits plus a minimum level that depends from the size of the farm (misured in family annual work units):

$$withdraws = perCapMinWithdrawal*AWU$$

$$+ max(0,profits*withdrawalProfitShare)$$ (2)

If the liquidy can be tought as a buffer, the debit level shoud be considered as a threshold, expressed as the share of the whole capital that farmers can't overpass.

The whole capital is in turn calculated as the sum of the liquidity, the investments current value and the land capital:

$$capital_{t}=liquidity_t+ \sum_{i=0}^{I}{investmentCurrentValue_{i,t}}+landCapital$$ (3)

with $I$ is the number of owned investments. The current value of investment objects depends from the kind of investment itself: e.g. in perennial crops the value first grows up and then decreases, in stables instead it linearly decreases.
$landCapital$ is, at least now, fixed and read from the farmers' data file.