IDEAS home Printed from https://ideas.repec.org/p/ags/eaa160/249796.html
   My bibliography  Save this paper

The Common Agricultural Policy and Farmers’ Off-farm Labour Supply

Author

Listed:
  • Loughrey, Jason
  • Hennessy, Thia

Abstract

This paper uses farm-level data from Ireland to explore the impact of agricultural policies on the farm operators’ off-farm labour allocation decisions. The hypothesis that decoupled direct payments induce farmers to allocate more time to off-farm employment is tested. Despite earlier studies based Irish data finding evidence to support this hypothesis, the analysis presented here suggests that decoupled direct payments are significantly and negatively associated with both the probability and amount of time allocated to off-farm work. The potential relationship between farm income variability and off-farm employment decisions in the short and medium term for the case of Irish farm operators is also explored. The analysis identifies a positive association between farm income variability and off-farm employment in the medium term but no significant relationship in the short-term. This suggests that off-farm employment is part of a wider portfolio decision and the recent increases in farm income variability due to reforms of the Common Agricultural Policy, has induced farmers to work more off farm.

Suggested Citation

  • Loughrey, Jason & Hennessy, Thia, 2016. "The Common Agricultural Policy and Farmers’ Off-farm Labour Supply," 160th Seminar, December 1-2, 2016, Warsaw, Poland 249796, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaa160:249796
    DOI: 10.22004/ag.econ.249796
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/249796/files/The%20CAP%20and%20off-farm%20labour%20supply%20Loughrey%20and%20Hennessy.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.249796?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. Ashok K. Mishra & Barry K. Goodwin, 1997. "Farm Income Variability and the Supply of Off-Farm Labor," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(3), pages 880-887.
    2. Loughrey, Jason & Hennessy, Thia & Hanrahan, Kevin & Donnellan, Trevor & Raimondi, Valentina & Olper, Alessandro, 2013. "Determinants of Farm Labour Use: A Comparison between Ireland and Italy," Working papers 157119, Factor Markets, Centre for European Policy Studies.
    3. 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.
    4. Maravalle, Alessandro & Claeys, Peter, 2012. "Boom–bust cycles and procyclical fiscal policy in a small open economy," Journal of Policy Modeling, Elsevier, vol. 34(5), pages 735-754.
    5. Jason Loughrey & Thia Hennessy, 2016. "Farm income variability and off-farm employment in Ireland," Agricultural Finance Review, Emerald Group Publishing Limited, vol. 76(3), pages 378-401, September.
    6. Robert Finger & Nadja El Benni, 2014. "Alternative Specifications of Reference Income Levels in the Income Stabilization Tool," Cooperative Management, in: Constantin Zopounidis & Nikos Kalogeras & Konstadinos Mattas & Gert Dijk & George Baourakis (ed.), Agricultural Cooperative Management and Policy, edition 127, chapter 0, pages 65-85, Springer.
    7. Donnellan, Trevor & Hennessy, Thia C., 2012. "The Labour Allocation Decisions of Farm Households: Defining a theoretical model," Working papers 137021, Factor Markets, Centre for European Policy Studies.
    8. Jason Loughrey & Fiona Thorne & Thia Hennessy, 2016. "A Microsimulation Model for Risk in Irish Tillage Farming," International Journal of Microsimulation, International Microsimulation Association, vol. 9(2), pages 41-76.
    9. John E. Lee, 1965. "Allocating Farm Resources between Farm and Nonfarm Uses," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 47(1), pages 83-92.
    10. Thia C. Hennessy & Tahir Rehman, 2008. "Assessing the Impact of the ‘Decoupling’ Reform of the Common Agricultural Policy on Irish Farmers’ Off‐farm Labour Market Participation Decisions," Journal of Agricultural Economics, Wiley Blackwell, vol. 59(1), pages 41-56, February.
    Full references (including those not matched with items on IDEAS)

    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. Loughrey, Jason & Hennessy, Thia & Hanrahan, Kevin & Donnellan, Trevor & Raimondi, Valentina & Olper, Alessandro, 2013. "Determinants of Farm Labour Use: A Comparison between Ireland and Italy," 2013: Productivity and Its Impacts on Global Trade, June 2-4, 2013. Seville, Spain 152332, International Agricultural Trade Research Consortium.
    2. Tocco, Barbara & Davidova, Sophia & Bailey, Alastair, 2013. "The Impact of CAP Payments on the Exodus of Labour from Agriculture in Selected EU Member States," Working papers 160742, Factor Markets, Centre for European Policy Studies.
    3. Olper, Alessandro & Raimondi, Valentina & Cavicchioli, Daniele & Vigani, Mauro, 2011. "Does Common Agricultural Policy Reduce Farm Labour Migration? A Panel Data Analysis Across EU Regions," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114597, European Association of Agricultural Economists.
    4. Liu, Yue & Yao, Shunbo & Lin, Ying, 2018. "Effect of Key Priority Forestry Programs on off-farm employment: Evidence from Chinese rural households," Forest Policy and Economics, Elsevier, vol. 88(C), pages 24-37.
    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. Radosław PASTUSIAK & Magdalena JASINIAK & Michał SOLIWODA & Joanna STAWSKA, 2017. "What may determine off-farm income? A review," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 63(8), pages 380-391.
    7. Loughrey, Jason & Hennessy, Thia, 2018. "The Common Agricultural Policy and The Farm Households’ Off-farm Labour Supply," 166th Seminar, August 30-31, 2018, Galway, West of Ireland 276230, European Association of Agricultural Economists.
    8. Raimondi, Valentina & Curzi, Daniele & Bertoni, Danilo & Olper, Alessandro, 2013. "Off-farm Labour Decision of Italian Farm Operators," Factor Markets Working Papers 173, Centre for European Policy Studies.
    9. Bojnec, Stefan & Ferto, Imre, 2011. "Impact of Off-farm Income on Farm Efficiency in Slovenia," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114258, European Association of Agricultural Economists.
    10. Tocco, Barbara & Davidova, Sophia & Bailey, Alastair Creation-Date: 2012-02, "undated". "Key Issues in Agricultural Labour Markets: A Review of Major Studies and Project Reports on Agriculture and Rural Labour Markets," Factor Markets Working Papers 126, Centre for European Policy Studies.
    11. Tocco, Barbara & Davidova, Sophia & Bailey, Alastair, 2016. "Part-Time Farming in Italy: Does Farm Size Really Matter?," 90th Annual Conference, April 4-6, 2016, Warwick University, Coventry, UK 236291, Agricultural Economics Society.
    12. Abdul-Salam, Yakubu & Roberts, Deborah, 2018. "Determinants of off-farm work and its effect on agricultural input intensity," 92nd Annual Conference, April 16-18, 2018, Warwick University, Coventry, UK 273486, Agricultural Economics Society.
    13. Pastusiak, Radosław & Jasiniak, Magdalena & Stawska, Joanna & Soliwoda, Michał, 2017. "Znaczenie dochodów pozarolniczych w gospodarstwach rolnych Kanady i USA," Village and Agriculture (Wieś i Rolnictwo), Polish Academy of Sciences (IRWiR PAN), Institute of Rural and Agricultural Development, vol. 1(174).
    14. Olper, Alessandro & Raimondi, Valentina & Cavicchioli, Daniele & Vigani, Mauro, "undated". "Reallocation of Agricultural Labor and Farm Subsidies: Evidence From the EU Regions," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126645, International Association of Agricultural Economists.
    15. Corsi, Alessandro & Salvioni, Cristina, 2017. "Once part-timer always part-timer? Causes for persistence in off farm work state of farmers," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 6(2), September.
    16. S Subramanian, 2018. "Participation of rural households in farm, non-farm and pluri-activity: Evidences from India," Working Papers 412, Institute for Social and Economic Change, Bangalore.
    17. Andrea Pufahl & Christoph R. Weiss, 2009. "Evaluating the effects of farm programmes: results from propensity score matching," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 36(1), pages 79-101, March.
    18. Wagener, Andreas & Zenker, Juliane, 2018. "Decoupled but not neutral: The effects of stochastic transfers on investment and incomes in rural Thailand," TVSEP Working Papers wp-008, Leibniz Universitaet Hannover, Institute for Environmental Economics and World Trade, Project TVSEP.
    19. Peter Howley & Emma Dillon & Thia Hennessy, 2014. "It’s not all about the money: understanding farmers’ labor allocation choices," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 31(2), pages 261-271, June.
    20. Thia C. Hennessy & Tahir Rehman, 2008. "Assessing the Impact of the ‘Decoupling’ Reform of the Common Agricultural Policy on Irish Farmers’ Off‐farm Labour Market Participation Decisions," Journal of Agricultural Economics, Wiley Blackwell, vol. 59(1), pages 41-56, February.

    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:eaa160:249796. 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/eaaeeea.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.