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Determinants and Dynamics of Farm Diversification

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  • Weiss, Christoph R.
  • Briglauer, Wolfgang

Abstract

This paper examines the impact of various farm and household characteristics (such as farm size, the off-farm employment status, the farm operator's age and schooling and the number of family members) on the level as well as the dynamics of on-farm diversification. Using linked census data for Upper-Austria from 1980, 1985 and 1990 we provide evidence that smaller farms are more specialised and also tend to increase the degree of specialisation over time more quickly than large farms. A significantly lower degree of diversification (higher degree of specialisation) as well as a stronger reduction in diversification over time is also reported for businesses operated by older, less educated, part-time farm operators. The analysis of diversification dynamics also suggests that (a) farms adjust to changes in their environment by steadily approaching their long-run equilibrium level of diversification (b-convergence), and (b) the variance of the diversification distribution declines over time (s-convergence). --

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Bibliographic Info

Paper provided by Christian-Albrechts-University of Kiel, Department of Food Economics and Consumption Studies in its series FE Working Papers with number 0002.

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Date of creation: 2000
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Handle: RePEc:zbw:caufew:0002

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  1. Yakov Amihud & Baruch Lev, 1981. "Risk Reduction as a Managerial Motive for Conglomerate Mergers," Bell Journal of Economics, The RAND Corporation, The RAND Corporation, vol. 12(2), pages 605-617, Autumn.
  2. Quiroz, Jorge A. & Valdes, Alberto, 1995. "Agricultural diversification and policy reform," Food Policy, Elsevier, Elsevier, vol. 20(3), pages 245-255, June.
  3. Teece, David J., 1980. "Economies of scope and the scope of the enterprise," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 1(3), pages 223-247, September.
  4. Christoph R. Weiss, 1999. "Farm Growth and Survival: Econometric Evidence for Individual Farms in Upper Austria," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, Agricultural and Applied Economics Association, vol. 81(1), pages 103-116.
  5. Merlin M. Hackbart & Donald A. Anderson, 1978. ""On Measuring Economic Diversification": Reply," Land Economics, University of Wisconsin Press, vol. 54(1), pages 110-112.
  6. S. Martin & F. McLeay, 1998. "The Diversity of Farmers' Risk Management Strategies in a Deregulated New Zealand Environment," Journal of Agricultural Economics, Wiley Blackwell, Wiley Blackwell, vol. 49(2), pages 218-233.
  7. Wolfgang Briglauer, . "Motives for Firm Diversification. A Survey on Theory and Empirical Evidence," WIFO Working Papers, WIFO 126, WIFO.
  8. Teece, David J., 1982. "Towards an economic theory of the multiproduct firm," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 3(1), pages 39-63, March.
  9. Levy, David T. & Haber, Lawrence J., 1986. "An advantage of the multiproduct firm : The transferability of firm-specific capital," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 7(3), pages 291-302, September.
  10. Knutson, Ronald D. & Smith, Edward G. & Anderson, David P., 1998. "Southern Farmers Exposure To Income Risk Under The 1996 Farm Bill," Working Papers, Texas A&M University, Agricultural and Food Policy Center 24025, Texas A&M University, Agricultural and Food Policy Center.
  11. Knutson, Ronald D. & Smith, Edward G. & Anderson, David P. & Richardson, James W., 1998. "Southern Farmers' Exposure To Income Risk Under The 1996 Farm Bill," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, Southern Agricultural Economics Association, vol. 30(01), July.
  12. Berry, Charles H, 1971. "Corporate Growth and Diversification," Journal of Law and Economics, University of Chicago Press, University of Chicago Press, vol. 14(2), pages 371-84, October.
  13. R. W. Fraser, 1990. "Producer Risk, Product Complementarity And Product Diversification," Journal of Agricultural Economics, Wiley Blackwell, Wiley Blackwell, vol. 41(1), pages 103-107.
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Cited by:
  1. Francksen, Tammo & Hagemann, Martin & Latacz-Lohmann, Uwe, 2011. "Eine empirische Untersuchung zum Wachstum von Milchviehbetrieben mittels der Ereignisanalyse," 51st Annual Conference, Halle, Germany, September 28-30, 2011, German Association of Agricultural Economists (GEWISOLA) 114494, German Association of Agricultural Economists (GEWISOLA).
  2. Boris Bravo & Horacio Cocchi & Daniel Solís, 2006. "Output Diversification Among Small-Scale Hillside Farmers In El Salvador," OVE Working Papers, Inter-American Development Bank, Office of Evaluation and Oversight (OVE) 1706, Inter-American Development Bank, Office of Evaluation and Oversight (OVE).
  3. Kimhi, Ayal & Rekah, Hila, 2005. "The Simultaneous Evolution Of Farm Size And Specialization: Dynamic Panel Data Evidence From Israeli Farm Communities," Discussion Papers, Hebrew University of Jerusalem, Department of Agricultural Economics and Management 7170, Hebrew University of Jerusalem, Department of Agricultural Economics and Management.
  4. Thiele, Holger D. & Weiss, Christoph R., 2002. "Diversifikation und Wachstum landwirtschaftlicher Unternehmen," FE Working Papers 0201, Christian-Albrechts-University of Kiel, Department of Food Economics and Consumption Studies.
  5. Raju Mandal, 2014. "Cropping Pattern Choice and Risk Mitigation in Flood Affected Agriculture: A Study of Assam Plains, India," Working Papers, Sam Houston State University, Department of Economics and International Business 1403, Sam Houston State University, Department of Economics and International Business.
  6. Ooms, Daan L. & Hall, Alastair R., 2005. "EU policy reform simulation based on panel data estimation of on- and off-farm labour supply equations for Dutch dairy farmers," 2005 Annual meeting, July 24-27, Providence, RI, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) 19434, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  7. Weiss, Christoph R. & Thiele, Holger D., 2002. "Diversifikation und Wachstum landwirtschaftlicher Unternehmen," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 51(3).

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