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Is off-farm income reforming the farm? Evidence from Mexico

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  • Lisa Pfeiffer
  • Alejandro López-Feldman
  • J. Edward Taylor

Abstract

Does access to off-farm income complement or compete with agricultural production? This article explores the effect of off-farm income on agricultural production activities, using data from the 2003 Mexico National Rural Household Survey. We first discuss the theoretical conditions under which access to off-farm income may influence production in an agricultural household model. Instrumental-variable (IV) estimation methods are then used to test whether agricultural production activities, technologies, and input use differ between households with and without access to off-farm income. We find that off-farm income has a negative effect on agricultural output and the use of family labor on the farm, but a positive impact on the demand for purchased inputs. There is also a slight efficiency gain in households with access to off-farm income. Findings offer insights into how household production evolves as rural households increasingly engage in off-farm income activities. Copyright (c) 2009 International Association of Agricultural Economists.

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Bibliographic Info

Article provided by International Association of Agricultural Economists in its journal Agricultural Economics.

Volume (Year): 40 (2009)
Issue (Month): 2 (03)
Pages: 125-138

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Handle: RePEc:bla:agecon:v:40:y:2009:i:2:p:125-138

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Cited by:
  1. Babatunde, Raphael O. & Qaim, Matin, 2010. "Impact of Off-farm Income on Food Security and Nutrition in Nigeria," 2010 AAAE Third Conference/AEASA 48th Conference, September 19-23, 2010, Cape Town, South Africa, African Association of Agricultural Economists (AAAE);Agricultural Economics Association of South Afri 97332, African Association of Agricultural Economists (AAAE);Agricultural Economics Association of South Africa (AEASA).
  2. Babatunde, Raphael O. & Qaim, Matin, 2010. "Impact of off-farm income on food security and nutrition in Nigeria," Food Policy, Elsevier, Elsevier, vol. 35(4), pages 303-311, August.
  3. Hernandez, Ricardo & Reardon, Thomas & Guan, Zhengfei, 2012. "Rural Nonfarm Employment and Farm Technology in Guatemala," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil, International Association of Agricultural Economists 126849, International Association of Agricultural Economists.
  4. Bojnec, Stefan & Ferto, Imre, 2011. "Impact of Off-farm Income on Farm Efficiency in Slovenia," 85th Annual Conference, April 18-20, 2011, Warwick University, Coventry, UK, Agricultural Economics Society 108945, Agricultural Economics Society.
  5. Jin-Tao Zhan & Yan-Rui Wu & Xiao-Hui Zhang & Zhang-Yue Zhou, 2012. "Why do farmers quit from grain production in China? Causes and implications," China Agricultural Economic Review, Emerald Group Publishing, Emerald Group Publishing, vol. 4(3), pages 342-362, October.
  6. Kousar, Rakhshanda & Abdulai, Awudu, 2014. "Impact of non-farm work and land tenancy contracts on soil conservation measures," 88th Annual Conference, April 9-11, 2014, AgroParisTech, Paris, France, Agricultural Economics Society 170522, Agricultural Economics Society.
  7. Augustynska-Grzymek, Irena & Skarzyska, Aldona & Abramczuk, Lukasz, 2013. "The pluriactive development of agricultural holdings in Poland with regard to the living standards of their users," Studies in Agricultural Economics, Research Institute for Agricultural Economics, Research Institute for Agricultural Economics, vol. 115(1), February.
  8. Alderman, Harold & Yemtsov, Ruslan, 2012. "Productive role of safety nets : background paper for the World Bank 2012-2022 social protection and labor strategy," Social Protection Discussion Papers 67609, The World Bank.

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