Agricultural and Biological Sciences
8 years ago

Interest rates on farm credit impact employment and income distribution dramatically.

World Bank eBooks
A model for estimating the effects of credit pricing on farm level employment and income distribution
T. Inman Husain

Paper Summary

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The article presents a way to see how changing credit prices can affect farm employment and income. The researchers made a model using math to see how different policies could impact what crops are grown, how technology is used, and who gets money. They found that the interest rate for farm loans has a big influence on how much money farmers make and how many people they can hire. By adjusting the interest rate, wage rate, farm management rules, and crop prices, the researchers could predict how farm income and jobs would change.