Determinants of off‐farm work and its effects on farm performance: the case of Norwegian grain farmers |
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| Authors: | Gudbrand Lien Subal C Kumbhakar J Brian Hardaker |
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| Institution: | 1. Norwegian Agricultural Economics Research Institute, Oslo, Norway and Lillehammer University College, P.O. Box 952, 2604, Lillehammer, Norway;2. Binghamton University, Department of Economics, LT 1009, Binghamton, NY 13902, USA;3. School of Business, Economics and Public Policy, University of New England, Armidale, NSW, 2351, Australia |
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| Abstract: | Limited attention has been given in the literature to the impact of off‐farm work on farm performance. More knowledge about the determinants of part‐time farming and its effects on farm performance could help policymakers to introduce better targeted rural development policies. The aim in this article is to fill part of the above‐mentioned gaps by analyzing factors that influence the choices of off‐farm work by either the farmer alone or jointly by both the farmer and partner; and simultaneously examining how off‐farm work influences farm performance. These analyses were based on an unbalanced panel data set from Norwegian grain farms during 1991 to 2005. Among the determinants of off‐farm work hours, we found that, in addition to demographic, time trend, and some regional effects, there was a significant negative effect of farm output on farmers' off‐farm work hours. The production function results revealed that off‐farm work had a positive effect on farm output, at first increasing but then decreasing with increase in hours spent in off‐farm work. Furthermore, our analysis revealed no systematic effect of off‐farm work on farm technical efficiency. |
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| Keywords: | D21 Q12 Q18 Off‐farm work Performance Efficiency Endogeneity Unobserved heterogeneity Panel data Norwegian agriculture |
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