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Multi-Enterprising Farm Households: The Importance of Their Alternative Business Ventures in the Rural Economy

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  • Vogel, Stephen J.
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    Abstract

    Almost a third of U.S. farm households generate income by engaging in business ventures independent of commodity production, with distinctly different community and household benefits. In 2007, 686,600 farm households engaged in 791,000 income-generating activities distinct from commodity production, creating $26.7 billion in household income. Onfarm diversification activities like agritourism and off-farm business ventures each accounted for about half of these activities, but off-farm businesses generated about 80 percent of total alternative (i.e., noncommodity) business income earned by farm households, creating the largest impact on the local economy. Off-farm businesses operated by farm households contributed an estimated $54.6 billion in value-added income to the gross regional products of their local economies and paid out $24.5 billion in wages and salaries to 853,100 part-time and full-time employees. In general, the share of the local employment base accounted for by farmer-owned off-farm businesses was higher in more rural counties.

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    File URL: http://purl.umn.edu/138015
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    Paper provided by United States Department of Agriculture, Economic Research Service in its series Economic Information Bulletin with number 138015.

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    Date of creation: Oct 2012
    Handle: RePEc:ags:uersib:138015
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    Keywords: onfarm diversification; off-farm businesses; portfolio entrepreneur; farm household typology; nonfarm employment; direct sales; Community/Rural/Urban Development;

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    1. M. Shucksmith, 1993. "Farm Household Behaviour And The Transition To Post-Productivism," Journal of Agricultural Economics, Wiley Blackwell, vol. 44(3), pages 466-478.
    2. Sara Carter, 1998. "Portfolio entrepreneurship in the farm sector: indigenous growth in rural areas?," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 10(1), pages 17-32, January.
    3. Elena G. Irwin & Andrew M. Isserman & Maureen Kilkenny & Mark D. Partridge, 2010. "A Century of Research on Rural Development and Regional Issues," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 92(2), pages 522-553.
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    Cited by:

    1. Khanal, Aditya & Mishra, Ashok, 2015. "Interlinked diversification strategies: Evidence from farm business households," 2015 Annual Meeting, January 31-February 3, 2015, Atlanta, Georgia 196860, Southern Agricultural Economics Association.
    2. Bartolini, Fabio & Andreoli, Maria & Brunori, Gianluca, 2013. "Explaining the determinants of on-farm diversification: The case Study of Tuscany Region," 2013 Second Congress, June 6-7, 2013, Parma, Italy 149903, Italian Association of Agricultural and Applied Economics (AIEAA).
    3. Mirzaei, Omid & Micheels, Eric T. & Boecker, Andreas, 2016. "Product and Marketing Innovation in Farm-Based Businesses: The Role of Entrepreneurial Orientation and Market Orientation," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association (IFAMA), vol. 19(2).

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