IDEAS home Printed from https://ideas.repec.org/a/pal/eurjdr/v26y2014i4p490-508.html
   My bibliography  Save this article

Trapped in Agriculture? Credit Constraints, Investments in Education and Agricultural Employment

Author

Listed:
  • Ruxanda Berlinschi

    (1] LICOS – Centre for Institutions and Economic Performance, KU Leuven, Leuven, Belgium[2] Department of Economics, Hogeschool Universiteit Brussel, Brussels, Belgium)

  • Johan Swinnen

    (LICOS – Centre for Institutions and Economic Performance, KU Leuven, Leuven, Belgium)

  • Kristine Van Herck

    (LICOS – Centre for Institutions and Economic Performance, KU Leuven, Leuven, Belgium)

Abstract

The basic neo-classical model implies that agricultural employment responds positively to increases in farm income. This argument is assumed by proponents and critics of agricultural subsidy programs in their discourse in favor of or against government support for farmers. However, empirical evidence on the relationship between agricultural employment and farm income (and subsidies) is mixed, and some studies find evidence that an increase in farm income has a negative impact on agricultural employment. This article proposes a new explanation for this puzzle. When farm income increases, part of the additional income is invested by credit-constrained farmers in their children’s education and educated children are less likely to become farmers themselves. We provide a theoretical model and empirical evidence supporting this argument.

Suggested Citation

  • Ruxanda Berlinschi & Johan Swinnen & Kristine Van Herck, 2014. "Trapped in Agriculture? Credit Constraints, Investments in Education and Agricultural Employment," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 26(4), pages 490-508, September.
    • Handle: RePEc:pal:eurjdr:v:26:y:2014:i:4:p:490-508
    as

    Download full text from publisher

    File URL: http://www.palgrave-journals.com/ejdr/journal/v26/n4/pdf/ejdr201430a.pdf
    File Function: Link to full text PDF
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: http://www.palgrave-journals.com/ejdr/journal/v26/n4/full/ejdr201430a.html
    File Function: Link to full text HTML
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jerzy Michalek & Pavel Ciaian & D'Artis Kancs, 2016. "Investment Crowding Out: Firm-Level Evidence from Northern Germany," Regional Studies, Taylor & Francis Journals, vol. 50(9), pages 1579-1594, September.
    2. Agnes Gold & Stefan Gold, 2019. "Drivers of Farm Efficiency and Their Potential for Development in a Changing Agricultural Setting in Kerala, India," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 31(4), pages 855-880, September.
    3. Garrone, Maria & Emmers, Dorien & Olper, Alessandro & Swinnen, Johan, 2019. "Jobs and agricultural policy: Impact of the common agricultural policy on EU agricultural employment," Food Policy, Elsevier, vol. 87(C), pages 1-1.
    4. Edgar E. Twine & Elizaphan J. O. Rao & Isabelle Baltenweck & Amos O. Omore, 2019. "Are Technology Adoption and Collective Action Important in Accessing Credit? Evidence from Milk Producers in Tanzania," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 31(3), pages 388-412, July.
    5. Hyytiä Nina, 2020. "Russian Food Import Ban – Impacts on Rural and Regional Development in Finland," European Countryside, Sciendo, vol. 12(4), pages 506-526, December.
    6. Mengling Zhang & Zhenlin Weng & Zhaojiu Chen & Feng Wu, 2022. "Land Endowment and Parental Educational Investment in Rural China," Sustainability, MDPI, vol. 14(8), pages 1-14, April.
    7. Agnė Žičkienė & Rasa Melnikienė & Mangirdas Morkūnas & Artiom Volkov, 2022. "CAP Direct Payments and Economic Resilience of Agriculture: Impact Assessment," Sustainability, MDPI, vol. 14(17), pages 1-24, August.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:eurjdr:v:26:y:2014:i:4:p:490-508. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave-journals.com/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.