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Abstract

There are many scientific works the effects of monetary policy on the competitiveness of enterprises. However, no research has yet been conducted on agricultural enterprises. Therefore, the aim of this article is to indicate the effects of monetary policy on the competitiveness of agricultural enterprises. Regression analysis is a suitable econometric method to determine the strength of the effects of monetary policy on competitiveness. In our model, a multiple regression method was used, where interest rates, inflation and exchange rate were defined as exogenous (independent) variables, while revenues of agricultural enterprises were defined as an endogenous (dependent) variable. The findings reveal that the monetary policy significantly affects agricultural competitiveness. Specifically, higher interest rates are shown to have a negative impact on the performance of agricultural enterprises. Economic theory states that higher interest rates have a negative impact on competitiveness, and the results of calculations show that interest rates do have a dominant impact on the agricultural enterprise performance. Monetary policymakers, especially the central bank, should focus on keeping interest rates low in order to increase the availability of operating and investment capital. A market environment with low interest rates could stimulate the introduction of innovations, the implementation of new technologies and the development of robotization in agricultural enterprises. Lower financing costs due to low interest rates could boost business activities and economic growth, which could have a positive impact on the competitiveness of agricultural businesses. The conclusions of our research confirm that in the Czech Republic monetary policy remains a key tool for supporting the development of agricultural enterprises and their competitiveness.

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