IDEAS home Printed from https://ideas.repec.org/a/ags/arerjl/106062.html
   My bibliography  Save this article

The Impact of Human Capital on Farm Operator Household Income

Author

Listed:
  • El-Osta, Hisham S.

Abstract

Data from the 2006 Agricultural Resource Management Survey and multivariate regression procedures are used to examine the role of human capital in impacting the incomes of farm households. The paper uses an “adjusted” concept of income where government payments are subtracted from total household income thus allowing for the utilization of government payments as a potential control variable in the regression models. Findings indicate a significant and positive role for higher education except for farm households at the very lower and upper ends of the income distribution.

Suggested Citation

  • El-Osta, Hisham S., 2011. "The Impact of Human Capital on Farm Operator Household Income," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 40(1), pages 1-21, April.
    • Handle: RePEc:ags:arerjl:106062
    DOI: 10.22004/ag.econ.106062
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/106062/files/el-osta%20-%20current.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.106062?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Milton Friedman & Simon Kuznets, 1945. "Income from Independent Professional Practice," NBER Books, National Bureau of Economic Research, Inc, number frie54-1, June.
    2. Mishra, Ashok K. & El-Osta, Hisham S. & Johnson, James D., 1999. "Factors Contributing To Earnings Success Of Cash Grain Farms," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 31(3), pages 1-15, December.
    3. Harwood, Joy L. & Heifner, Richard G. & Coble, Keith H. & Perry, Janet E. & Somwaru, Agapi, 1999. "Managing Risk in Farming: Concepts, Research, and Analysis," Agricultural Economic Reports 34081, United States Department of Agriculture, Economic Research Service.
    4. Smith, Aaron D. & Goe, W. Richard & Kemey, Martin & Morrison Paul, Catherine J., 2004. "Computer and Internet Use by Great Plains Farmers," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 29(3), pages 1-20, December.
    5. Christopher D. Carroll & Karen E. Dynan & Spencer D. Krane, 2003. "Unemployment Risk and Precautionary Wealth: Evidence from Households' Balance Sheets," The Review of Economics and Statistics, MIT Press, vol. 85(3), pages 586-604, August.
    6. Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January.
    7. Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," NBER Chapters, in: Investment in Human Beings, pages 9-49, National Bureau of Economic Research, Inc.
    8. Frahan, Bruno Henry de & Nkunzimana, Tharcisse & De Blander, Rembert & Gaspart, Frederic & Sumner, Daniel A., 2008. "Farm Household Incomes And Reforming The Cap," 109th Seminar, November 20-21, 2008, Viterbo, Italy 44814, European Association of Agricultural Economists.
    9. Joseph G. Altonji & Ulrich Doraszelski, 2005. "The Role of Permanent Income and Demographics in Black/White Differences in Wealth," Journal of Human Resources, University of Wisconsin Press, vol. 40(1).
    10. Ritzen, Jozef M & Winkler, Donald R, 1977. "The Production of Human Capital over Time," The Review of Economics and Statistics, MIT Press, vol. 59(4), pages 427-437, November.
    11. Parker, Timothy S. & Gibbs, Robert, 2005. "Low Earnings But Steady Job Growth in Low-Employment Counties," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, pages 1-2, September.
    12. Jacob Mincer & Solomon Polachek, 1974. "Family Investments in Human Capital: Earnings of Women," NBER Chapters, in: Marriage, Family, Human Capital, and Fertility, pages 76-110, National Bureau of Economic Research, Inc.
    13. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-838, May.
    14. Craig Gundersen & Susan Offutt, 2005. "Farm Poverty and Safety Nets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(4), pages 885-899.
    15. David Card, 1994. "Earnings, Schooling, and Ability Revisited," Working Papers 710, Princeton University, Department of Economics, Industrial Relations Section..
    16. Lazear, Edward P, 1980. "Family Background and Optimal Schooling Decisions," The Review of Economics and Statistics, MIT Press, vol. 62(1), pages 42-51, February.
    17. Moshe Buchinsky, 1998. "Recent Advances in Quantile Regression Models: A Practical Guideline for Empirical Research," Journal of Human Resources, University of Wisconsin Press, vol. 33(1), pages 88-126.
    18. Lee Adkins & R. Carter Hill, 2007. "Bootstrap Inferences in Heteroscedastic Sample Selection Models: A Monte Carlo Investigation," Economics Working Paper Series 0710, Oklahoma State University, Department of Economics and Legal Studies in Business.
    19. Smith, Richard J & Blundell, Richard W, 1986. "An Exogeneity Test for a Simultaneous Equation Tobit Model with an Application to Labor Supply," Econometrica, Econometric Society, vol. 54(3), pages 679-685, May.
    20. Roe, Terry & Somwaru, Agapi & Diao, Xinshen, 2002. "Do direct payments have intertemporal effects on U.S. agriculture?," TMD discussion papers 104, International Food Policy Research Institute (IFPRI).
    21. Joe Dewbre, 2006. "The Impact of Coupled and Decoupled Government Subsidies on Off-Farm Labor Participation of U.S. Farm Operators," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(2), pages 393-408.
    22. Newbery, David M, 1989. "The Theory of Food Price Stabilisation," Economic Journal, Royal Economic Society, vol. 99(398), pages 1065-1082, December.
    23. Parker, Timothy S., 2007. "Policy Options for a Changing Rural America," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, pages 1-8, May.
    24. Pence Karen M., 2006. "The Role of Wealth Transformations: An Application to Estimating the Effect of Tax Incentives on Saving," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 5(1), pages 1-26, July.
    25. Breusch, T S & Pagan, A R, 1979. "A Simple Test for Heteroscedasticity and Random Coefficient Variation," Econometrica, Econometric Society, vol. 47(5), pages 1287-1294, September.
    26. Joshua D. Angrist & Alan B. Keueger, 1991. "Does Compulsory School Attendance Affect Schooling and Earnings?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(4), pages 979-1014.
    27. Daniele Checchi, 2005. "Heckman, J., and Krueger, A.: Inequality in America – What Role for Human Capital Policies?," Journal of Economics, Springer, vol. 86(1), pages 85-89, October.
    28. David A. Green, 2007. "A Cautionary Discussion about Relying on Human Capital Policy to Meet Redistributive Goals," Canadian Public Policy, University of Toronto Press, vol. 33(4), pages 397-418, December.
    29. Yoram Ben-Porath, 1967. "The Production of Human Capital and the Life Cycle of Earnings," Journal of Political Economy, University of Chicago Press, vol. 75(4), pages 352-352.
    30. Charles F. Manski, 2000. "Economic Analysis of Social Interactions," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 115-136, Summer.
    31. Bruce L. Gardner, 2000. "Economic Growth and Low Incomes in Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(5), pages 1059-1074.
    32. Carneiro, Pedro & Heckman, James J., 2003. "Human Capital Policy," IZA Discussion Papers 821, Institute of Labor Economics (IZA).
    33. Wozniak, Gregory D, 1984. "The Adoption of Interrelated Innovations: A Human Capital Approach," The Review of Economics and Statistics, MIT Press, vol. 66(1), pages 70-79, February.
    34. Duncan, Otis Dudley, 1974. "Family Investments in Human Capital: Earnings of Women: Comment," Journal of Political Economy, University of Chicago Press, vol. 82(2), pages 109-110, Part II, .
    35. Kathryn Wilson, 2001. "The Determinants of Educational Attainment: Modeling and Estimating the Human Capital Model and Education Production Functions," Southern Economic Journal, John Wiley & Sons, vol. 67(3), pages 518-551, January.
    36. Hisham S. El‐Osta & Ashok K. Mishra & Mitchell J. Morehart, 2007. "Determinants of economic well‐being among U.S. farm operator households," Agricultural Economics, International Association of Agricultural Economists, vol. 36(3), pages 291-304, May.
    37. Mallar, Charles D, 1977. "The Estimation of Simultaneous Probability Models," Econometrica, Econometric Society, vol. 45(7), pages 1717-1722, October.
    38. Michelle L. Barnes & Anthony W. Hughes, 2002. "A quantile regression analysis of the cross section of stock market returns," Working Papers 02-2, Federal Reserve Bank of Boston.
    39. repec:ebl:ecbull:v:15:y:2006:i:13:p:1-10 is not listed on IDEAS
    40. Robert Gibbs & John Cromartie, 2007. "Education's Effect on Poverty: The Role of Migration ," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 29(3), pages 437-445.
    41. Mary A. Marchant, 1997. "Bargaining Models for Farm Household Decision Making: Discussion," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(2), pages 602-604.
    42. Dewbre, Joe & Mishra, Ashok K., 2002. "Farm Household Incomes And U.S. Government Program Payment," 2002 Annual meeting, July 28-31, Long Beach, CA 19780, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    43. Hahn, Jinyong, 1995. "Bootstrapping Quantile Regression Estimators," Econometric Theory, Cambridge University Press, vol. 11(1), pages 105-121, February.
    44. Nigel Key & Michael J. Roberts, 2009. "Nonpecuniary Benefits to Farming: Implications for Supply Response to Decoupled Payments," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(1), pages 1-18.
    45. James J. Heckman & Alan B. Krueger, 2005. "Inequality in America: What Role for Human Capital Policies?," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262582600 edited by Benjamin M. Friedman, December.
    46. Hung-Hao Chang & Dayton M. Lambert & Ashok K. Mishra, 2008. "Does participation in the conservation reserve program impact the economic well-being of farm households?," Agricultural Economics, International Association of Agricultural Economists, vol. 38(2), pages 201-212, March.
    47. Robert Haveman & Barbara Wolfe & James Spaulding, 1991. "Childhood events and circumstances influencing high school completion," Demography, Springer;Population Association of America (PAA), vol. 28(1), pages 133-157, February.
    48. Dooley, Martin D & Gottschalk, Peter, 1984. "Earnings Inequality among Males in the United States: Trends and the Effect of Labor Force Growth," Journal of Political Economy, University of Chicago Press, vol. 92(1), pages 59-89, February.
    49. Theodore W. Schultz, 1960. "Capital Formation by Education," Journal of Political Economy, University of Chicago Press, vol. 68(6), pages 571-571.
    50. Dubman, Robert, 2000. "Variance Estimation With USDA's Farm Costs and Returns Surveys and Agricultural Resource Management Study Surveys," Staff Reports 276685, United States Department of Agriculture, Economic Research Service.
    51. Rivers, Douglas & Vuong, Quang H., 1988. "Limited information estimators and exogeneity tests for simultaneous probit models," Journal of Econometrics, Elsevier, vol. 39(3), pages 347-366, November.
    52. M. -Y. Chen & F. -L. Lin & C. -K. Chang, 2009. "Relations between health care expenditure and income: an application of local quantile regressions," Applied Economics Letters, Taylor & Francis Journals, vol. 16(2), pages 177-181.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Brown, Jason P. & Weber, Jeremy, 2013. "The Off-Farm Occupations of U.S. Farm Operators and Their Spouses," Economic Information Bulletin 156535, United States Department of Agriculture, Economic Research Service.
    2. Shuai Zhou & Guangqing Chi, 2022. "Farmland Rental: The Impacts of Household Demographics and Livelihood Strategies in China," Land, MDPI, vol. 11(8), pages 1-18, August.
    3. Wang, Sun Ling & Hoppe, Robert A. & Hertz, Thomas & Xu, Shicong, 2022. "Farm Labor, Human Capital, and Agricultural Productivity in the United States," USDA Miscellaneous 323858, United States Department of Agriculture.
    4. Ahearn, Mary Clare & Sterns, James, 2013. "Direct-to-Consumer Sales of Farm Products: Producers and Supply Chains in the Southeast," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 45, pages 1-12, August.
    5. Jesse B. Tack & Rulon D. Pope & Jeffrey T. LaFrance & Ricardo H. Cavazos, 2015. "Modelling an aggregate agricultural panel with application to US farm input demands," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 42(3), pages 371-396.
    6. Khanal, Aditya R. & Mishra, Ashok K., 2013. "Assessing the Impact of Internet Access on Household Income and Financial Performance of Small Farms," 2013 Annual Meeting, February 2-5, 2013, Orlando, Florida 143019, Southern Agricultural Economics Association.
    7. Rakhshanda, Kousar & Awudu, Abdulai, 2013. "Impacts of rural non-farm employment on household welfare in Pakistan," 2013 Second Congress, June 6-7, 2013, Parma, Italy 149890, Italian Association of Agricultural and Applied Economics (AIEAA).
    8. Frederick Quaye, 2016. "Effects of Multiple Risks on Farm Income and Willingness to Pay for Agricultural Insurance: A Case Study of the Greater Accra Region in Ghana," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 8(6), pages 1-1, June.
    9. Long Niu & Chuntian Lu & Rui Sun, 2023. "The Impact of Livelihood Capital on Subjective Well-Being of New Professional Farmers: Evidence from China," Sustainability, MDPI, vol. 15(14), pages 1-17, July.
    10. Khanal, Aditya R. & Mishra, Sachin K & Honey, Ummey, 2018. "Certified organic food production, financial performance, and farm size: An unconditional quantile regression approach," Land Use Policy, Elsevier, vol. 78(C), pages 367-376.
    11. D'Antoni, Jeremy M. & Khanal, Aditya R. & Mishra, Ashok K., 2014. "Examining Labor Substitution: Does Family Matter for U.S. Cash Grain Farmers?," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 46(2), pages 1-12, May.
    12. Miller, Cristina D. M. & Mishra, Ashok K., 2022. "Health Insurance Coverage, Government Payments, and Labor Allocation," IZA Discussion Papers 15262, Institute of Labor Economics (IZA).
    13. Schorr, A. & Lips, M., 2018. "Influence of milk yield on profitability a quantile regression analysis," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277000, International Association of Agricultural Economists.
    14. Ashok K. Mishra & J. Mathew Fannin & Hyunjeong Joo, 2014. "Off-Farm Work, Intensity of Government Payments, and Farm Exits: Evidence from a National Survey in the United States," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 62(2), pages 283-306, June.
    15. Mishra, Ashok K. & Harris, Michael & Bampasidou, Maria, 2018. "Health Insurance Coverage and Labor Allocation of Beginning Farm Operator Households," 2018 Annual Meeting, August 5-7, Washington, D.C. 274172, Agricultural and Applied Economics Association.
    16. Hadrich, Joleen C. & Wolf, Christopher A. & Johnson, Kamina K., 2015. "Chacterizing U.S. Dairy Farm Wealth and Income Distributions," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205383, Agricultural and Applied Economics Association.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:eee:labchp:v:1:y:1986:i:c:p:525-602 is not listed on IDEAS
    2. Hisham S. El-Osta, 2016. "Farmland Ownership and Its Impact on the Debt Servicing Capacity Among U.S. Married-Couple Farm Households," Applied Economics and Finance, Redfame publishing, vol. 3(4), pages 190-206, November.
    3. Guilhem Bascle, 2008. "Controlling for endogeneity with instrumental variables in strategic management research," Post-Print hal-00576795, HAL.
    4. Angel López-Nicolás & Jaume García & Pedro J. Hernández, 2001. "How wide is the gap? An investigation of gender wage differences using quantile regression," Empirical Economics, Springer, vol. 26(1), pages 149-167.
    5. Chintawar, Sachin & Mishra, Ashok K. & Gillespie, Jeffrey M., 2009. "The Impact of Adoption of Genetically Modified Corn on the Off-Farm Labor Supply in the United States," 2009 Annual Meeting, January 31-February 3, 2009, Atlanta, Georgia 46832, Southern Agricultural Economics Association.
    6. Chaitali Sinha, 2014. "Human Capital and Public Policy," South Asian Journal of Macroeconomics and Public Finance, , vol. 3(1), pages 79-125, June.
    7. Heckman, James J. & Lochner, Lance J. & Todd, Petra E., 2006. "Earnings Functions, Rates of Return and Treatment Effects: The Mincer Equation and Beyond," Handbook of the Economics of Education, in: Erik Hanushek & F. Welch (ed.), Handbook of the Economics of Education, edition 1, volume 1, chapter 7, pages 307-458, Elsevier.
    8. James J. Heckman & Lance J. Lochner & Petra E. Todd, 2003. "Fifty Years of Mincer Earnings Regressions," NBER Working Papers 9732, National Bureau of Economic Research, Inc.
    9. Barry R. Chiswick, 2006. "Jacob Mincer, Experience and the Distribution of Earnings," Springer Books, in: Shoshana Grossbard (ed.), Jacob Mincer A Pioneer of Modern Labor Economics, chapter 10, pages 109-126, Springer.
    10. Hisham S. El-Osta & Ashok K. Mishra & Mitchell J. Morehart, 2008. "Off-Farm Labor Participation Decisions of Married Farm Couples and the Role of Government Payments," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 30(2), pages 311-332.
    11. Cinthya G. Caamal Olvera, 2017. "Decreasing returns to schooling in Mexico," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 32(1), pages 27-63.
    12. Tae-Hwan Kim & Halbert White, 2003. "Estimation, Inference, And Specification Testing For Possibly Misspecified Quantile Regression," Advances in Econometrics, in: Maximum Likelihood Estimation of Misspecified Models: Twenty Years Later, pages 107-132, Emerald Group Publishing Limited.
    13. Uematsu, Hiroki & Mishra, Ashok K., 2011. "Use of Direct Marketing Strategies by Farmers and Their Impact on Farm Business Income," Agricultural and Resource Economics Review, Cambridge University Press, vol. 40(1), pages 1-19, April.
    14. Machado, Jose A. F. & Silva, J. M. C. Santos, 2000. "Glejser's test revisited," Journal of Econometrics, Elsevier, vol. 97(1), pages 189-202, July.
    15. Stenberg, Anders & Westerlund, Olle, 2016. "Flexibility at a cost – Should governments stimulate tertiary education for adults?," The Journal of the Economics of Ageing, Elsevier, vol. 7(C), pages 69-86.
    16. Richard Mussa, 2013. "Rural--urban differences in parental spending on children's primary education in Malawi," Development Southern Africa, Taylor & Francis Journals, vol. 30(6), pages 789-811, December.
    17. Deniz Karaoğlan & Dürdane Şirin Saraçoğlu, 2018. "Socio-Economic Factors Affecting Early Childhood Health: the Case of Turkey," Child Indicators Research, Springer;The International Society of Child Indicators (ISCI), vol. 11(3), pages 1051-1075, June.
    18. Tobias Angel & Alexandre Berthe & Valeria Costantini & Mariagrazia D’Angeli, 2024. "How the nature of inequality reduction matters for CO2 emissions," Working Papers 2024.14, Fondazione Eni Enrico Mattei.
    19. Anna Piil Damm, 2009. "Ethnic Enclaves and Immigrant Labor Market Outcomes: Quasi-Experimental Evidence," Journal of Labor Economics, University of Chicago Press, vol. 27(2), pages 281-314, April.
    20. Russell Davidson & Victoria Zinde‐Walsh, 2017. "Advances in specification testing," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 50(5), pages 1595-1631, December.
    21. Bhaskar, Arathi & Beghin, John C., 2009. "How Coupled Are Decoupled Farm Payments? A Review of the Evidence," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 34(1), pages 1-24, April.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:arerjl:106062. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/nareaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.