Agricultural and Biological Sciences
4 years ago

Farm income fluctuations drive farm households to invest in non-farm assets.

RePEc: Research Papers in Economics
DETERMINANTS OF INVESTMENTS IN NON-FARM ASSETS BY FARM HOUSEHOLDS
Teresa Serra, Barry K. Goodwin, Allen M. Featherstone

Paper Summary

Farm households in Kansas were studied to understand why they invest in non-farm assets. The researchers looked at data from 1994 to 2000 and found that when farm income is unpredictable, farm households tend to invest more in non-farm assets. This suggests that non-farm assets are used by farmers to manage the risks associated with their farm income.

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