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Panel Data Estimation of Labour Supply Equations for Dutch Dairy Farmers

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  • Ooms, Daan
  • Hall, A.R. Alastair

Abstract

This research focuses on the estimation of labour supply equations for Dutch dairy farmers. Off-farm labour supply is characterised by the fact that only half of the farm households supply off-farm labour. This results in a sample selection estimation problem that has to be taken into account in estimation. In this research we use the panel data sample selection estimation method of Wooldridge (1995) to estimate the off-farm labour supply equation. Simulation results suggest that the decoupledness assumption of direct income paymenst in CAP reform might hold. At least there is a negligible effect through labour supply.

Suggested Citation

  • Ooms, Daan & Hall, A.R. Alastair, 2005. "Panel Data Estimation of Labour Supply Equations for Dutch Dairy Farmers," 89th Seminar, February 2-5, 2005, Parma, Italy 234636, European Association of Agricultural Economists.
  • Handle: RePEc:ags:eaae89:234636
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    References listed on IDEAS

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    1. Huffman, Wallace E, 1980. "Farm and Off-Farm Work Decisions: The Role of Human Capital," The Review of Economics and Statistics, MIT Press, vol. 62(1), pages 14-23, February.
    2. Weiss, Christoph R. & Briglauer, Wolfgang, 2000. "Determinants and Dynamics of Farm Diversification," FE Working Papers 0002, Christian-Albrechts-University of Kiel, Department of Food Economics and Consumption Studies.
    3. Woldehanna, Tassew & Lansink, Alfons Oude & Peerlings, Jack, 2000. "Off-farm work decisions on Dutch cash crop farms and the 1992 and Agenda 2000 CAP reforms," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 22(2), March.
    4. Barry K. Goodwin & Matthew T. Holt, 2002. "Parametric and Semiparametric Modeling of the Off-Farm Labor Supply of Agrarian Households in Transition Bulgaria," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(1), pages 184-209.
    5. Mundlak, Yair, 1978. "On the Pooling of Time Series and Cross Section Data," Econometrica, Econometric Society, vol. 46(1), pages 69-85, January.
    6. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    7. Gary Chamberlain, 1980. "Analysis of Covariance with Qualitative Data," Review of Economic Studies, Oxford University Press, vol. 47(1), pages 225-238.
    8. Wooldridge, Jeffrey M., 1995. "Selection corrections for panel data models under conditional mean independence assumptions," Journal of Econometrics, Elsevier, vol. 68(1), pages 115-132, July.
    9. Ahituv, Avner & Kimhi, Ayal, 2002. "Off-farm work and capital accumulation decisions of farmers over the life-cycle: the role of heterogeneity and state dependence," Journal of Development Economics, Elsevier, vol. 68(2), pages 329-353, August.
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