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The increasing importance of nonfarm income and the changing use of labor and capital in rice farming: the case of Central Luzon, 1979-2003

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  • Kazushi Takahashi
  • Keijiro Otsuka

Abstract

There have been sharp increases in nonfarm income among farm households in Central Luzon for the last few decades. This study attempts to identify the effects of the increasing nonfarm income on the use of tractors and threshers and on the employment of hired labor as a substitute for family labor. We found that while the increased nonfarm income positively affects the ownership of tractors, it has no significant impact on the use of agricultural machines due presumably to the development of efficient machine rental markets. We also found that the increased nonfarm income leads to the increased use of hired labor, thereby releasing family labor to nonfarm jobs. Copyright (c) 2009 International Association of Agricultural Economists.

Suggested Citation

  • Kazushi Takahashi & Keijiro Otsuka, 2009. "The increasing importance of nonfarm income and the changing use of labor and capital in rice farming: the case of Central Luzon, 1979-2003," Agricultural Economics, International Association of Agricultural Economists, vol. 40(2), pages 231-242, March.
  • Handle: RePEc:bla:agecon:v:40:y:2009:i:2:p:231-242
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    1. Takashi Kurosaki & Humayun Khan, 2006. "Human Capital, Productivity, and Stratification in Rural Pakistan," Review of Development Economics, Wiley Blackwell, vol. 10(1), pages 116-134, February.
    2. Otsuka, Keijiro, 1991. "Determinants and consequences of land reform implementation in the Philippines," Journal of Development Economics, Elsevier, vol. 35(2), pages 339-355, April.
    3. Thomas Reardon & Eric Crawford & Valerie Kelly, 1994. "Links Between Nonfarm Income and Farm Investment in African Households: Adding the Capital Market Perspective," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 76(5), pages 1172-1176.
    4. Marcel Fafchamps & Agnes R. Quisumbing, 1999. "Human Capital, Productivity, and Labor Allocation in Rural Pakistan," Journal of Human Resources, University of Wisconsin Press, vol. 34(2), pages 369-406.
    5. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-766, May.
    6. Otsuka, Keijiro & Chuma, Hiroyuki & Hayami, Yujiro, 1993. "Permanent Labour and Land Tenancy Contracts in Agrarian Economies: An Integrated Analysis," Economica, London School of Economics and Political Science, vol. 60(237), pages 57-77, February.
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    Cited by:

    1. Emiko Fukase & Will Martin, 2016. "Who Will Feed China in the 21st Century? Income Growth and Food Demand and Supply in China," Journal of Agricultural Economics, Wiley Blackwell, vol. 67(1), pages 3-23, February.
    2. Tschirley, David & Reardon, Thomas, 2016. "Impact on Employment and Migration of Structural and Rural Transformation," Food Security International Development Working Papers 245895, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    3. Benjamin Davis & Paul Winters & Thomas Reardon & Kostas Stamoulis, 2009. "Rural nonfarm employment and farming: household-level linkages," Agricultural Economics, International Association of Agricultural Economists, vol. 40(2), pages 119-123, March.
    4. Linxiu Zhang & Weiliang Su & Tor Eriksson & Chengfang Liu, 2016. "How Off-farm Employment Affects Technical Efficiency of China's Farms: The Case of Jiangsu," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 24(3), pages 37-51, May.
    5. Zhang, Xiaobo & Yang, Jin & Thomas, Reardon, 2017. "Mechanization outsourcing clusters and division of labor in Chinese agriculture," China Economic Review, Elsevier, vol. 43(C), pages 184-195.
    6. Chamberlin, Jordan & Jayne, T.S., 2013. "Unpacking the Meaning of ‘Market Access’: Evidence from Rural Kenya," World Development, Elsevier, vol. 41(C), pages 245-264.

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