Farmers operate their business in a dynamic environment. Fluctuating prices, evolving agricultural and environmental policies, technological change and increasing consumer demands for product quality (e.g. with respect to environmental friendly production methods, animal welfare and food safety) frequently require adjustment of production and input levels on individual farms. Quantities of variable production factors like animal feed or pesticides can usually be adjusted easily together with changing production levels. Quantities of labour, capital and land however, are less easy to adjust. Instantaneous adjustment may be impossible or imply (high) costs of adjustment. In the long run, quantities of these quasi-fixed factors can be adjusted at lower costs of adjustment.The Dutch pig sector is an interesting case for studying adjustment of quasi-fixed factors. Increases in the average farm size, accompanied by an ongoing specialisation, implied considerable adjustments for individual farms. Moreover, environmental legislation has had a significant impact on pig production, providing another reason to study adjustment behaviour of Dutch pig farms.Understanding the process of adjustment of quasi-fixed factors is important for a number of reasons. First, it shows how farmers reorganise their production in the long run as a reaction to changes in the economic environment, e.g. a decrease in output prices. Second, understanding adjustment of quasi-fixed factors may explain farmers' entry and exit decisions. Third, knowledge about long run adjustment processes at the farm level can be used in economic models to simulate long-term effects of agricultural and environmental policies on individual farms.The objective of this thesis is to study capital adjustment at individual pig farms in the Netherlands, taking farm-specific characteristics into account. In order to study this process, micro-economic models are constructed and estimated. From this broad objective, four specific objectives are defined and worked out in ...