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Measuring precautionary wealth using cross-sectional data: the case of farm households

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  • Ashok Mishra
  • Hiroki Uematsu
  • J. Matthew Fannin

Abstract

This study models and investigates the presence of precautionary wealth among farm households, something few studies have attempted. Using pooled farm-level data, we find that self-employed farm households accumulate more wealth. Precautionary savings is about 8% of total household wealth. In addition, we find that age, education, occupation, and operation size are important factors influencing wealth accumulation by US farm households. Copyright Springer Science+Business Media, LLC 2013

Suggested Citation

  • Ashok Mishra & Hiroki Uematsu & J. Matthew Fannin, 2013. "Measuring precautionary wealth using cross-sectional data: the case of farm households," Review of Economics of the Household, Springer, vol. 11(1), pages 131-141, March.
    • Handle: RePEc:kap:reveho:v:11:y:2013:i:1:p:131-141
    DOI: 10.1007/s11150-011-9139-0
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    References listed on IDEAS

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    Cited by:

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    2. Niu, Geng & Wang, Qi & Li, Han & Zhou, Yang, 2020. "Number of brothers, risk sharing, and stock market participation," Journal of Banking & Finance, Elsevier, vol. 113(C).
    3. Lugilde, Alba, 2018. "Does income uncertainty affect Spanish household consumption?," MPRA Paper 87110, University Library of Munich, Germany.
    4. Lugilde, Alba & Bande, Roberto & Riveiro, Dolores, 2017. "Precautionary Saving: a review of the theory and the evidence," MPRA Paper 77511, University Library of Munich, Germany.
    5. Farrin, Katie & Miranda, Mario J. & O'Donoghue, Erik, 2016. "How Do Time and Money Affect Agricultural Insurance Uptake? A New Approach to Farm Risk Management Analysis," Economic Research Report 262194, United States Department of Agriculture, Economic Research Service.

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    More about this item

    Keywords

    Precautionary wealth; Farm households; Income variability; Pooled data; Education; Labor allocation; D14; J22; J24; Q12; Q14;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q14 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Finance

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