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Farmers' time allocation between farm work and off-farm work and the importance of unobserved group effects: evidence from Israeli cooperatives

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  • Kimhi, Ayal

Abstract

Agricultural cooperatives differ in many attributes which affect members' farm and off‐farm earnings in different ways. As a result, time allocation patterns between farm work and off‐farm work will vary significantly across cooperatives. Participation equations in farm work and off‐farm work of farmers who are members of Israeli moshavim are estimated jointly, including a cooperative‐specific factor in each equation. The fixed effects are found to be significant and important, but can be only partly explained by observed cooperative attributes. This provides another support to the Monte Carlo results of Borjas and Sueyoshi, that controlling for group effects is superior to alternative models. The results also imply that unobserved factors have considerable effects on farmers' time allocation, and hence should be controlled for whenever possible.
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  • Kimhi, Ayal, 1996. "Farmers' time allocation between farm work and off-farm work and the importance of unobserved group effects: evidence from Israeli cooperatives," Agricultural Economics, Blackwell, vol. 14(2), pages 135-142, July.
    • Handle: RePEc:eee:agecon:v:14:y:1996:i:2:p:135-142
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    3. Woldehanna, Tassew & Lansink, Alfons Oude & Peerlings, Jack, 2000. "Off-farm work decisions on Dutch cash crop farms and the 1992 and Agenda 2000 CAP reforms," Agricultural Economics, Blackwell, vol. 22(2), pages 163-171, March.
    4. Bartosz Bartkowski & Stephan Bartke, 2018. "Leverage Points for Governing Agricultural Soils: A Review of Empirical Studies of European Farmers’ Decision-Making," Sustainability, MDPI, vol. 10(9), pages 1-27, September.
    5. Tocco, Barbara & Bailey, Alastair & Davidova, Sophia & Raimondi, Valentina, 2015. "Women and Part-Time Farming: Understanding Labor Supply Decisions in Italian Farm Households," 2015 Conference, August 9-14, 2015, Milan, Italy 211932, International Association of Agricultural Economists.
    6. Berbel, J. & Rodriguez-Ocana, A., 1998. "An MCDM approach to production analysis: An application to irrigated farms in Southern Spain," European Journal of Operational Research, Elsevier, vol. 107(1), pages 108-118, May.

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