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Has Debt Restructuring Facilitated Structural Transformation On Israeli Family Farms?

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  • Kimhi, Ayal

Abstract

This paper analyzes structural transformation on Israeli family farms using longitudinal village-level data for the years 1992-2001, with particular emphasis on the effects of the 1985 debt crisis and the subsequent 1992 debt settlement legislation. Dynamic panel GMM estimation reveals a negative effect of the amount of debt, and a positive effect of reaching a debt restructuring agreement, on farm size. Reaching an agreement also had an indirect negative effect on the shift to off-farm work. No significant effect was found on farm exits. This implies that the debt restructuring legislation accomplished its goal of rehabilitating the farm sector, at least to some extent.

Suggested Citation

  • Kimhi, Ayal, 2008. "Has Debt Restructuring Facilitated Structural Transformation On Israeli Family Farms?," Discussion Papers 6255, Hebrew University of Jerusalem, Department of Agricultural Economics and Management.
    • Handle: RePEc:ags:huaedp:6255
    DOI: 10.22004/ag.econ.6255
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    References listed on IDEAS

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    1. Ayal Kimhi & Nitzan Tzur-Ilan, 2021. "Structural Changes in Israeli Family Farms: Long-Run Trends in the Farm Size Distribution and the Role of Part-Time Farming," Agriculture, MDPI, vol. 11(6), pages 1-15, June.

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