The analysis in this paper estimates micro-economic drivers of diversity in crop production in Afghanistan with particular emphasis on the implications of household access to non-farm income. Descriptive analysis shows that a third of farmers do not diversify, while the majority of those that do, grow only two or three crops. Econometric analysis reveals that while landholding size, farm characteristics and assets, and proximity to markets significantly increase diversification, a significantly lower degree of diversification is found for households with higher non-farm income. This is consistent with the hypothesis that allocation of farm labour away from non-farm activities decreases diversity due to negative labour effects, perhaps because the opportunity cost of farm labour is higher than rural wages. Identification through instrumental variables confirms endogeneity in off-farm income, revealing that unobserved factors such as risk-aversion behaviour and relative efficiency may drive household decisions to diversify into both non-farm activity and crop mixing.
Impact of off-farm income and paid taxes on the composition and volatility of incomes and wealth of dairy farmers in the Netherlands
This paper analyses the composition and volatility of the total income and wealth of dairy farmers and the importance and...
