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Agricultural Profits and Farm Household Wealth: A Farm-level Analysis Using Repeated Cross Sections

Published online by Cambridge University Press:  26 January 2015

Steven C. Blank ,
Kenneth W. Erickson ,
Richard Nehring  and
Charles Hallahan
Steven C. Blank
Affiliation:
Agricultural and Resource Economics Department, University of California, Davis, and a member of the Giannini Research Foundation
Kenneth W. Erickson
Affiliation:
Farm Sector Performance and Well-Being Branch, U.S. Department of Agriculture, Economic Research Service, Resource and Rural Economics Division, Farm Household and Rural Well-Being Branch, Washington, DC
Richard Nehring
Affiliation:
U.S. Department of Agriculture, Economic Research Service, Resource and Rural Economics Division, Farm Structure Branch, Washington, DC
Charles Hallahan
Affiliation:
U.S. Department of Agriculture, Economic Research Service, Information Services Division, Washington, DC
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Abstract

This study examines the relationship between agricultural profits and farm household wealth across locations and farm sizes in U.S. agriculture. A multiperiod household model is used to develop hypotheses for testing. Results indicate that farmland has out-performed nonfarm investments over the past decade. Thus, households may want to keep their farmland to build wealth, even if it requires them to earn off-farm income. The analysis implies that decision will be made based on farm household wealth factors having little to do with agriculture.

Keywords

farm householdoff-farm incomeproduction profitswealthQ12Q14
Type
Research Article
Information
Journal of Agricultural and Applied Economics , Volume 41 , Issue 1 , April 2009 , pp. 207 - 225
Copyright
Copyright © Southern Agricultural Economics Association 2009

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