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Risk Management and the Role of Off-farm Income AgEcon
Freshwater, David; Jette-Nantel, Simon.
The majority of farm households in OECD countries earn more off-farm income than farm income, even including government payments. While this is a well recognized fact its implications for risk management have not been well recognized. Current efforts to reform farm support have focused on the variability of farm household income and largely ignored the variability of total farm household income. Since it is common for farm households to allocate labor and capital across both farm and non-farm opportunities, it is also likely that their attitude to risk in farming can best be understood by seeing farm risk and return in a household portfolio of income. This approach immediately leads to farm risk being less problematic the more diversified the portfolio...
Tipo: Working Paper Palavras-chave: Off-farm income; Risk management; Agricultural policy; Farm household; Farm income; Agricultural and Food Policy; Agricultural Finance; Farm Management; Risk and Uncertainty.
Ano: 2011 URL: http://purl.umn.edu/120184
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Farm Income Variability and Off-Farm Diversification in Canadian Agriculture AgEcon
Jette-Nantel, Simon; Freshwater, David; Beaulieu, Martin S.; Katchova, Ani L..
For a majority of farm families and operators in OECD countries, off-farm or non-farm occupations have become a significant source of income and a major determinant of their well being. This study investigates the use of off-farm employment as a risk management tool by farm operators. A two-part model is developed to estimate the impact of farm income risk on the decision to participate in the off-farm labour market and the level of off-farm employment income. Longitudinal farm level data for about 30,000 Canadian farms from 2001 to 2006 are used for this study. The variability of farm market revenue is found to positively affect the likelihood of off-farm work and the level of off-farm employment income, in particular for operators of larger commercial...
Tipo: Conference Paper or Presentation Palavras-chave: Agricultural Finance.
Ano: 2010 URL: http://purl.umn.edu/56497
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