Off-farm Work, Technical Efficiency, and Production Risk: Empirical Evidence from a National Farmer Survey in Taiwan

The objective of this paper is to investigate the differences in yield production, production efficiency, and yield risk for farmers with and without off-farm work. Using a nationwide survey of Taiwanese rice farmers, we estimate a stochastic production frontier model accommodating the technical inefficiency and the production risk simultaneously. Applying the stochastic dominance criterion to rank the estimated technical efficiency and yield risk between professional farmers and farmers with off-farm jobs, our empirical analysis shows that off-farm work is significantly associated with lower technical efficiency. Additionally, farmers with off-farm work face higher production risks. Comparing the marginal effects of input uses on technical inefficiency and yield risk between these groups of farmers, we found a substantial heterogeneity of input uses between these two groups of farmers.Off-farm work, technical efficiency, production risk, Taiwan, Crop Production/Industries, Farm Management,

Does Participation in the Conservation Reserve Program and/or Off-Farm Work Affect the Level and Distribution of Farm Household Income?

Since both release resources from agricultural production, it is not surprising that decisions to work off the farm and to participate in the U. S. Conservation Reserve Program (CRP) are correlated. By incorporating these decisions into a heteroskedastic specification of a farm household income function, we identify their effects on mean income, as well as on the variability in income for groups of farm households participating in combinations of these activities. Our results indicate participation in CRP and off-farm work by the operator and the spouse increase farm household income, but these choices also decrease the variability in household income among participant households relative to that of other farm households with otherwise similar characteristics.Conservation Reserve Program, farm household income, income distribution, off-farm work, Agribusiness, Agricultural Finance, Farm Management,

Participation in the Conservation Reserve Program and Off-Farm Work: Implications for Farm and Farm Household Productivity

Using a national survey of U.S farm households, we investigate the interrelationship between participation in the Conservation Reserve Program (CRP) and the decision to work off the farm. We go on examine the effects of these two decisions on farm and farm household efficiency and productivity by estimating stochastic frontier productions for farm output and multiple output-orientated distance functions that consider income from agricultural sales, the CRP and off-farm work as outputs of the farm household. We control for the effects of self selection in estimating both the frontier production and distance functions. It appears that operators' decisions to work off the farm have led to significant improvements in household resource allocation between farm and other productive activities by farm households -- leading to high technical efficiency for both farm and farm household activities. In contract, participation in the CRP alone leads to the reduction of the technical efficiency and productivity on farm as well as on combined household activities.Farm Management,

Does Participation in the Conservation Reserve Program and Off-Farm Work Affect the Level and Distribution of Farm Household Incomes?

Using a national survey of U.S farm households, this paper investigates the interrelationship among the decisions to work off the farm by the operator and the spouse, and participation in the Conservation Reserve Program (CRP). The effects of these three decisions on farm household income are also examined. By estimating a heteroscedastic household income function, we identify the effects of participating in these activities on the average level of farm household income and its variation within each sub-group of farms involved in the several combinations of activities. Our empirical results support the hypothesis that participation in the CRP and decisions to work off the farm by the operator and the spouse are made jointly rather than independently. The operators' decisions to work off the farm and to participate in CRP increase the mean level of the household income, while the spouses' decisions to work off the farm help decrease the variation in household income among households in that sub-group.Farm Management,

Tax-Deferred Retirement Savings of Farm Households: An Empirical Investigation

This study examines factors affecting tax-deferred retirement savings among farm households. A double-hurdle model is estimated using 2003 Agricultural Resource Management Survey (ARMS) farm-level national data. Results indicate that demographic factors, total household income, off-farm work, and risk preference play important roles in retirement savings plan participation. Retirement savings increase with household size, intensity of off-farm work by farm operator and spouse, and size of farming operation. We find that the amount of retirement savings decreases with operator’s age and increases with spouse’s age, and that cash grain and dairy farmers have lower retirement savings.double-hurdle estimation, farm households, probit, retirement savings, risk preference, total household income, Agricultural Finance, Consumer/Household Economics,

Are Farmers' Decisions to Work off the Farm and Participate in the Conservation Reserve Program Independent, Joint or Sequential?

There is statistical evidence that decisions to participate in CRP and work off-farm are made simultaneously. Characteristics of households, farm operations other farm programs, and the local economies affect both decisions; some factors affect only one. Policy changes that affect one decision may affect another directly and/or indirectly.CRP, Off-farm labor, Choice Structure, Farm Management,

The Conservation Reserve Program, Off-Farm Work, and Farm Household Technical Efficiencies

Using data from a national survey of farm households in the United States, this paper examines the effects of farm households’ decisions to participate in the Conservation Reserve Program (CRP) and to work off the farm on the technical efficiency of farm household production. After controlling for the self selection bias in estimating the multiple output-oriented distance functions, results show that operators’ decisions to work off the farm (both separately and combined with participation in CRP) lead to higher technical efficiencies for farm household production— implying improvements in the resource allocation between farm and other productive activities by farm households. The technical efficiencies of household production of those farm households participating only in the CRP are lower.Conservation Reserve Program, off-farm work, household technical efficiency, Agribusiness, Agricultural Finance, Farm Management,

Health Information Availability and the Consumption of Eggs: Are Consumers Bayesians?

We use a generalized Bayesian updating model to estimate the impact of health information appearing in the popular media on the consumption of eggs. Our model allows media publications with differing circulation numbers to have differing effects. Further, we explore the possible effects of several known psychological biases in learning.Marketing,

Explaining Participation in the Conservation Reserve Program and its Effects on Farm Productivity and Efficiency

Using a three-stage sample selection model, we identify factors affecting the probability and level of participation in CRP. Statistical tests support hypotheses that off-farm work and participation in other farm programs are exogenous to the CRP decision. We compare the relative technical and scale efficiencies for CRP participants and non-participants.CRP, Choice Modeling, Productivity, Environmental Economics and Policy,

TARIFF RATE IMPORT QUOTAS, DOMESTIC MARKET STRUCTURE AND AGRICULTURAL SUPPORT PROGRAM: THE CASE OF TAIWANESE RICE IMPORT

After joining the WTO in 2002, Taiwan allowed rice imports for the first time by implementing an import quota subject to a special safeguard tariff. In 2003, the import quota was expanded to a two-tier tariff rate import quota system. Although Taiwan maintained land set-asides and domestic support prices for producer sales to the State Trading Enterprise, the latter was limited to importing only 65 percent of the import quota with the rest sold to private traders. This sudden transformation of the Taiwanese import regime and rice market along with the government proposal for a "strategic alliance" amongst traders highlights the importance of studying the effects of policy reforms in the framework of imperfect domestic market structure. The purpose of this paper is to analyze Taiwanese rice policy reforms using a computational partial equilibrium model. The impact of import controls, price supports, land set-aside and alternative market structures are assessed, including the potential change in regimes within the tariff quota system. Our results show that the "strategic alliance" proposed by the agricultural authority will further distort the domestic market. Elimination of the domestic support price and land set-aside improves social welfare independent of the market structure while a change in the market structure towards competition is always social welfare improving regardless of domestic policy instruments. But the policy regime of the tariff quota (the in-quota tariff versus the out-of-quota tariff versus the quota) and hence social welfare is sensitive to changes in both domestic policy instruments and market structure.tariff rate quota, strategic alliance, domestic support, market structure, Agricultural and Food Policy, International Relations/Trade, Q17, Q18,