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The Relevance of the Extent of Farm Work to the Analysis of Off-Farm Labor Supply of Farmers

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  • Kimhi, Ayal

Abstract

Farm labor supply of farm operators is important for the analysis of their off-farm labor supply. We use a unique data set which includes such information to demonstrate its importance. Other studies had to use implicit assumptions in order to proxy the marginal product of farm labor with observable farm attributes. We find that these assumptions are too strong. We do it by estimating the off-farm participation equation over different subsamples defined according to the level of farm work. We correct for selection by estimating an endogenous switching regression model of the off-farm participation decision, in which the selection criterion is farm participation. Selection is found to be significant for farm workers only. The qualitative conclusions are unaffected by controlling for selection.
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Suggested Citation

  • Kimhi, Ayal, 1991. "The Relevance of the Extent of Farm Work to the Analysis of Off-Farm Labor Supply of Farmers," Working Papers 197761, University of Maryland, Department of Agricultural and Resource Economics.
    • Handle: RePEc:ags:umdrwp:197761
    DOI: 10.22004/ag.econ.197761
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    1. Huffman, Wallace E & Lange, Mark D, 1989. "Off-Farm Work Decisions of Husbands and Wives: Joint Decision Making," The Review of Economics and Statistics, MIT Press, vol. 71(3), pages 471-480, August.
    2. Lopez, Ramon E., 1982. "Applications Of Duality Theory To Agriculture," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 7(2), pages 1-14, December.
    3. Oliveira, Victor J., 1990. "Nonfarm Employment of Farm Operators, Hired Farmworkers, and Unpaid Farmworkers," Agricultural Economic Reports 305545, United States Department of Agriculture, Economic Research Service.
    4. Murphy, Kevin M & Topel, Robert H, 2002. "Estimation and Inference in Two-Step Econometric Models," Journal of Business & Economic Statistics, American Statistical Association, vol. 20(1), pages 88-97, January.
    5. Chris Robinson & Pat J. McMahon & John C. Quiggin, 1982. "Labour Supply And Off‐Farm Work By Farmers: Theory And Estimation," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 26(1), pages 23-38, April.
    6. Lass, Daniel A. & Findeis, Jill L. & Hallberg, Milton C., 1989. "Off-Farm Employment Decisions By Massachusetts Farm Households," Northeastern Journal of Agricultural and Resource Economics, Northeastern Agricultural and Resource Economics Association, vol. 18(2), pages 1-11, October.
    7. Daniel A. Sumner, 1982. "The Off-Farm Labor Supply of Farmers," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 64(3), pages 499-509.
    8. Huffman, Wallace E., 1990. "Local Labor Market Conditions: Effects on Labor Demand and Wage Labor Supply Decisions of Farm and Rural Nonfarm Couples, 1978-82," ISU General Staff Papers 199006170700001212, Iowa State University, Department of Economics.
    9. Waldman, Donald M, 1981. "An Economic Interpretation of Parameter Constraints in a Simultaneous-Equations Model with Limited Dependent Variables," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 22(3), pages 731-739, October.
    10. Brian W. Gould & William E. Saupe, 1989. "Off-Farm Labor Market Entry and Exit," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 71(4), pages 960-969.
    11. Kimhi, Ayal, 1991. "Estimation of Endogenous Switching Regression Models with Discrete Dependent Variables: An Application to the Estimation of Farm Women's Farm and Off-Farm Participation Equations," Working Papers 197766, University of Maryland, Department of Agricultural and Resource Economics.
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    1. Kimhi, Ayal, 1991. "Part-Time Farming Versus Specialization of Farm Operators in Farm or Off-Farm Work: A Multinomial Logit Analysis," Working Papers 197771, University of Maryland, Department of Agricultural and Resource Economics.
    2. Kimhi, Ayal, 1991. "Estimation of Endogenous Switching Regression Models with Discrete Dependent Variables: An Application to the Estimation of Farm Women's Farm and Off-Farm Participation Equations," Working Papers 197766, University of Maryland, Department of Agricultural and Resource Economics.

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    Farm Management; Labor and Human Capital;

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