Determinants of off-farm work and its effect on agricultural input intensity

Off-farm work is a common phenomenon among farm household members in industrialised nations. In Scotland, it is expected to grow partly due to Brexit induced uncertainty in agricultural policy and markets. Previous research has linked the phenomenon to farmers’ production choices with some research findings suggesting that it increases the uptake of low input intensity pro-environmental farming methods but the overall evidence is mixed. An understanding of the influence of the expected growth in off-farm work on farmer production choices and its impact on the intensity of input use is of interest given the increasing policy emphasis being given to supporting sustainable agricultural production methods. Using Scotland’s Farm Accounts Survey data, we examine the determinants of off-farm work and investigate its effects on two measures of agricultural intensity namely fertiliser and crop protection expenditures per hectare. We find that tenanted farmers managing relatively small farms are more likely to be involved in off-farm work. We also find that farmers with very high levels of off-farm work are significantly less intensive in the use of fertilisers but there is no evidence of any impact of off-farm work on their intensity of use of crop protection products. It follows that an increase in the proportion of farmers with off-farm work brought about by Brexit may have the unintended (positive) consequence of reducing the intensity of inorganic fertiliser use in agriculture, thereby making the sector more environmentally sustainable.