IDEAS home Printed from https://ideas.repec.org/p/win/winwop/2017-01.html
   My bibliography  Save this paper

We See Thee Rise: Quantifying Farm Size Expansion in Canada

Author

Listed:
  • Wenbiao Cai

Abstract

Average land size of Canadian farms increased from 500 to 730 acres between 1976 and 2006. Productive resources were also increasingly concentrated in farms from the upper tail of the size distribution. This paper uses a two-sector equilibrium model to quantify the importance of technological change versus farm subsidy in explaining this episode of farm size expansion. Exogenous variations in TFP and factor endowment account for 60 percent of the observed increase in average acreage. When farm subsidy is added, the model replicates the entire trajectory of farm size. The model’s predictions of employment in agriculture, agricultural value added per worker, average farm capital, and land value also accord well with data.

Suggested Citation

  • Wenbiao Cai, 2017. "We See Thee Rise: Quantifying Farm Size Expansion in Canada," Departmental Working Papers 2017-01, The University of Winnipeg, Department of Economics.
    • Handle: RePEc:win:winwop:2017-01
    as

    Download full text from publisher

    File URL: http://economics.uwinnipeg.ca/RePEc/winwop/2017-01.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Restuccia, Diego & Yang, Dennis Tao & Zhu, Xiaodong, 2008. "Agriculture and aggregate productivity: A quantitative cross-country analysis," Journal of Monetary Economics, Elsevier, vol. 55(2), pages 234-250, March.
    2. Alexander Bilson Darku & Stavroula Malla & Kien C. Tran, 2016. "Sources and Measurement of Agricultural Productivity and Efficiency in Canadian Provinces: Crops and Livestock," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 64(1), pages 49-70, March.
    3. Tasso Adamopoulos & Diego Restuccia, 2020. "Land Reform and Productivity: A Quantitative Analysis with Micro Data," American Economic Journal: Macroeconomics, American Economic Association, vol. 12(3), pages 1-39, July.
    4. Veeman, Terrence S. & Gray, Richard S., 2009. "Agricultural Production and Productivity in Canada," Choices: The Magazine of Food, Farm, and Resource Issues, Agricultural and Applied Economics Association, vol. 24(4), pages 1-8.
    5. Daniel Shapiro & Ray D. Bollman & Philip Ehrensaft, 1987. "Farm Size and Growth in Canada," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 69(2), pages 477-483.
    6. John Spriggs & G.C. Kooten, 1988. "Rationale for Government Intervention in Canadial Agriculture: A Review of Stabilization Programs," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 36(1), pages 1-21, March.
    7. Robert E. Lucas Jr., 1978. "On the Size Distribution of Business Firms," Bell Journal of Economics, The RAND Corporation, vol. 9(2), pages 508-523, Autumn.
    8. Cristina Echevarria, 1998. "A Three-Factor Agricultural Production Function: The Case of Canada," International Economic Journal, Taylor & Francis Journals, vol. 12(3), pages 63-75.
    9. Akos Valentinyi & Berthold Herrendorf, 2008. "Measuring Factor Income Shares at the Sector Level," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 11(4), pages 820-835, October.
    10. Gollin, Douglas & Parente, Stephen L. & Rogerson, Richard, 2007. "The food problem and the evolution of international income levels," Journal of Monetary Economics, Elsevier, vol. 54(4), pages 1230-1255, May.
    11. Yu Sheng & Eldon Ball & Katerina Nossal, 2015. "Comparing Agricultural Total Factor Productivity between Australia, Canada, and the United States, 1961-2006," International Productivity Monitor, Centre for the Study of Living Standards, vol. 29, pages 38-59, Fall.
    12. Ramon E. Lopez, 1984. "Estimating Substitution and Expansion Effects Using a Profit Function Framework," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 66(3), pages 358-367.
    13. Ramon E. Lopez, 1980. "The Structure of Production and the Derived Demand for Inputs in Canadian Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 62(1), pages 38-45.
    14. Hans P. Binswanger, 1974. "A Cost Function Approach to the Measurement of Elasticities of Factor Demand and Elasticities of Substitution," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 56(2), pages 377-386.
    15. G. C. Kooten, 1988. "Economic Impacts of Supply Management: Review and Comparison of Alternative Measures of Consumer Welfare Loss," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 36(3), pages 425-441, November.
    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. Chen, Chaoran, 2020. "Technology adoption, capital deepening, and international productivity differences," Journal of Development Economics, Elsevier, vol. 143(C).
    2. Blanco, Cesar & Raurich, Xavier, 2022. "Agricultural composition and labor productivity," Journal of Development Economics, Elsevier, vol. 158(C).
    3. Wenbiao Cai, 2019. "Technology, Policy Distortions, And The Rise Of Large Farms," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 60(1), pages 387-411, February.
    4. Chaoran Chen, 2017. "Untitled Land, Occupational Choice, and Agricultural Productivity," American Economic Journal: Macroeconomics, American Economic Association, vol. 9(4), pages 91-121, October.
    5. Cai, Wenbiao & Pandey, Manish, 2013. "Size-dependent labor regulations and structural transformation in India," Economics Letters, Elsevier, vol. 119(3), pages 272-275.
    6. Tasso Adamopoulos & Diego Restuccia, 2014. "The Size Distribution of Farms and International Productivity Differences," American Economic Review, American Economic Association, vol. 104(6), pages 1667-1697, June.
    7. Chaoran Chen & Diego Restuccia & Raul Santaeulalia-Llopis, 2022. "The Effects of Land Markets on Resource Allocation and Agricultural Productivity," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 45, pages 41-54, July.
    8. Carlos Bethencourt & Fernando Perera‐Tallo, 2020. "On the relationship between sectorial and institutional structural changes," Metroeconomica, Wiley Blackwell, vol. 71(3), pages 533-565, July.
    9. Aragón, Fernando M. & Restuccia, Diego & Rud, Juan Pablo, 2022. "Are small farms really more productive than large farms?," Food Policy, Elsevier, vol. 106(C).
    10. Gottlieb, Charles & Grobovšek, Jan, 2019. "Communal land and agricultural productivity," Journal of Development Economics, Elsevier, vol. 138(C), pages 135-152.
    11. Antonio Saravia & Carlos Gustavo Machicado & Felix Rioja, 2014. "Productivity, Structural Change and Latin American Development," Review of Development Economics, Wiley Blackwell, vol. 18(3), pages 610-624, August.
    12. Franz Hamann & Fernando Arias-Rodríguez & Jesus Bejarano & Margarita Gafaro & Juan C. Mendez-Vizcaino & Andrea Paola Poveda-Olarte, 2019. "Productividad total de los factores y eficiencia en el uso de los recursos productivos en Colombia," Revista ESPE - Ensayos Sobre Política Económica, Banco de la República, issue 89, pages 1-54, February.
    13. Marijn A. Bolhuis & Swapnika R. Rachapalli & Diego Restuccia, 2021. "Misallocation in Indian Agriculture," NBER Working Papers 29363, National Bureau of Economic Research, Inc.
    14. Chaoran Chen & Diego Restuccia & Raül Santaeulàlia-Llopis, 2023. "Land Misallocation and Productivity," American Economic Journal: Macroeconomics, American Economic Association, vol. 15(2), pages 441-465, April.
    15. Tasso Adamopoulos & Diego Restuccia, 2020. "Land Reform and Productivity: A Quantitative Analysis with Micro Data," American Economic Journal: Macroeconomics, American Economic Association, vol. 12(3), pages 1-39, July.
    16. Francisco J. Buera & Joseph P. Kaboski & Yongseok Shin, 2011. "Finance and Development: A Tale of Two Sectors," American Economic Review, American Economic Association, vol. 101(5), pages 1964-2002, August.
    17. Tasso Adamopoulos & Loren Brandt & Jessica Leight & Diego Restuccia, 2022. "Misallocation, Selection, and Productivity: A Quantitative Analysis With Panel Data From China," Econometrica, Econometric Society, vol. 90(3), pages 1261-1282, May.
    18. Alonso-Carrera, Jaime & Raurich, Xavier, 2018. "Labor mobility, structural change and economic growth," Journal of Macroeconomics, Elsevier, vol. 56(C), pages 292-310.
    19. Margarita Gafaro & Heitor S. Pellegrina, 2018. "Market access, agricultural productivity and selection into trade: evidence from Colombia," Borradores de Economia 1050, Banco de la Republica de Colombia.
    20. Pellegrina, Heitor S., 2022. "Trade, productivity, and the spatial organization of agriculture: Evidence from Brazil," Journal of Development Economics, Elsevier, vol. 156(C).

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    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:win:winwop:2017-01. 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: Soham Baksi (email available below). General contact details of provider: https://edirc.repec.org/data/dwinnca.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.