Direct payments, spatial competition and farm survival in Norway
We argue that interdependencies between farms are crucial for assessing effects of direct payments on farmers exit decisions. Using spatially explicit farm level data for nearly all Norwegian farms, a binary choice model with spatially lagged explanatory variables is estimated in order to explain farm survival from 1999 to 2009. We show that ignoring spatial interactions between farm leads to a substantial overestimation of the effects of direct payments on farm survival. To our knowledge, this paper is the first attempt to empirically analyze the role of neighbor interactions for farm structural change in general and for an assessment of the effects of direct payments on farm survival in particular.
|Date of creation:||2013|
|Date of revision:|
|Contact details of provider:|| Postal: 555 East Wells Street, Suite 1100, Milwaukee, Wisconsin 53202|
Phone: (414) 918-3190
Fax: (414) 276-3349
Web page: http://www.aaea.org
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- R. Pace & Shuang Zhu, 2012. "Separable spatial modeling of spillovers and disturbances," Journal of Geographical Systems, Springer, vol. 14(1), pages 75-90, January.
- 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, vol. 81(1), pages 103-116.
- Silke Huettel & Anne Margarian, 2009. "Structural change in the West German agricultural sector," Agricultural Economics, International Association of Agricultural Economists, vol. 40(s1), pages 759-772, November.
- Balmann, Alfons, 1997. "Farm-Based Modelling of Regional Structural Change: A Cellular Automata Approach," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 24(1), pages 85-108.
- LeSage, James P. & Pace, Robert Kelley, 2011. "Pitfalls in Higher Order Model Extensions of Basic Spatial Regression Methodology," The Review of Regional Studies, Southern Regional Science Association, vol. 41(1), pages 13-26, Summer.
- Happe, Kathrin & Balmann, Alfons & Kellermann, Konrad & Sahrbacher, Christoph, 2008. "Does structure matter? The impact of switching the agricultural policy regime on farm structures," Journal of Economic Behavior & Organization, Elsevier, vol. 67(2), pages 431-444, August.
- Stephan J. Goetz & David L. Debertin, 2001. "Why Farmers Quit: A County-Level Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(4), pages 1010-1023.
When requesting a correction, please mention this item's handle: RePEc:ags:aaea13:150022. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If references are entirely missing, you can add them using this form.