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Discrimination in the Markets for Farm Capital?

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  • Robert Tinney
  • Finis Welch

Abstract

Recent empirical investigations have estimated differential earnings of white and nonwhite labor and education and have interpreted these differences as the combined effects of many forms of economic discrimination. In this paper we use a relatively straightforward model to analyze the implications of discrimination in markets for capital funds. The model is designed to focus upon intermarket flows of goods, in this case white to black, and represents a simple modification of the common excess demand and supply frame of reference. The empirical evidence suggests that earned rates of return do not vary with the race of farm operators as most "theories" of discrimination would suggest. However, there is evidence that rates of return increase with farm size, and since Negroes operate smaller farms it is possible that discrimination has served as an impediment to expansion.

Suggested Citation

  • Robert Tinney & Finis Welch, 1971. "Discrimination in the Markets for Farm Capital?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 53(3), pages 401-410.
    • Handle: RePEc:oup:ajagec:v:53:y:1971:i:3:p:401-410.
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