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Direct payments and on-farm employment: evidence from a spatial regression discontinuity design

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  • Zimmert, Franziska
  • Zorn, Alexander

Abstract

Direct payments are regarded as a suitable instrument to safeguard jobs in the agricultural sector. However, empirical findings to date do not unambiguously support this expectation. We further empirically investigate this research question on dairy farms under weak identifying assumptions using a spatial regression discontinuity design. The Swiss direct payments system creates a discontinuous jump near the border of agricultural production zones for the amount of public subsidies a farm receives. We find that an additional CHF 50,000 can generate a job for a female family worker in the dairy sector. Male employment is not affected. These results show that direct payments can safeguard traditional family farming.

Suggested Citation

  • Zimmert, Franziska & Zorn, Alexander, 2021. "Direct payments and on-farm employment: evidence from a spatial regression discontinuity design," 61st Annual Conference, Berlin, Germany, September 22-24, 2021 317052, German Association of Agricultural Economists (GEWISOLA).
    • Handle: RePEc:ags:gewi21:317052
    DOI: 10.22004/ag.econ.317052
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    Keywords

    Agricultural and Food Policy; Consumer/Household Economics; Political Economy; Research Methods/Statistical Methods;
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