We evaluate farm financial stress within the U.S. over the past twenty years and the agricultural and economic factors which have impacted farm businesses. We further evaluate the effect of the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) on farm financial stress. In particular, Chapter 12 bankruptcies-which can only be filed by farmers-were only a temporary measure until BAPCPA made Chapter 12 a permanent fixture in bankruptcy law. We utilize filings of Chapter 12 bankruptcies from 1997 until 2016 as a proxy for farm financial stress. Panel fixed effects models are used to determine relevant factors affecting financial stress for farmers from agricultural and macroeconomic perspectives. Further, models incorporating pre-and post-BAPCPA regimes are utilized. We find that macroeconomic factors (interest and unemployment rates) are strong predictors of farm bankruptcies for farms while agricultural land values are the only consistent strong predictor among the agricultural factors. When evaluating the post-BAPCPA regime, only agricultural land values continue to be a significant predictor of farm bankruptcies. Our findings also indicate a dynamic relationship with agricultural land values, where current year values are negatively related but previous year land values are positively related to bankruptcies. We provide an analysis of the post-BAPCPA regime on farm bankruptcies that was not previously evaluated. Further, our findings illuminate discussion on a potentially dynamic relationship with financial stress and agricultural land values.

This study examines farm financial performance and stress for all farmers versus beginning farmers in the U.S. with emphasis on the agricultural downturn experienced since 2013. Using the USDA's Agricultural Resource Management Survey (ARMS) data, probit models are estimated to study the personal and farm characteristics that affect whether or not the financial ratios fall into critical zones as defined by the Farm Financial Standards Council. The financial ratios involve liquidity, solvency, profitability, efficiency, and repayment capacity. Beginning farmers are at a greater risk of financial stress on average, with higher likelihood of financial stress in liquidity and efficiency. Further, the recent agricultural downturn has negatively affected liquidity, solvency, and profitability for farmers while repayment capacity does not appear to be affected. During the downturn, beginning farmers are better positioned than the general farming population with respect to liquidity and repayment capacity. This paper applies current lending practices to a nationally representative sample of farms over a time of changing economic conditions for the agricultural sector.

We examine trends in bankruptcy completion times and financial characteristics for farmers filing for chapter 12 bankruptcy after it became a permanent fixture in bankruptcy law to assess justifications for the recently enacted Family Farmer Bankruptcy Clarification Act of 2017 and Family Farmer Relief Act of 2019. Since 2007, chapter 12 filers have seen noticeable increases in their debt levels whereas alternative business bankruptcies have either stagnated or declined in their debt. Using survival analysis methods to correct for the censored nature of open cases, we find that the average time to completion has consistently been longer for chapter 12 than the comparable chapters (7, 11, and 13) of business bankruptcies. Although chapter 12 completion times have not been increasing over time, we find that chapter 7 and 11 completion times have been declining over time for comparable businesses and that debt levels are a significant factor in increased completion times. Our results are consistent with claims that farmers have had rising debt levels in comparison to similar businesses filing for bankruptcy and provide evidence that farmers with increasing debt have had a more difficult time restructuring through chapter 12. EconLit citations: G33, K35, Q14, Q18.

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While post-disaster migration can move vulnerable populations from dangerous regions to relatively safe ones, little is known about decisions that migrants use to select new homes. We develop an econometric model of migrant flows to examine the characteristics of the destinations that attracted migrants leaving the New Orleans area following Hurricane Katrina in 2005 relative to migration behaviors in other years. We find an increased flow of migrants to large, nearby counties with a mixed effect of economic variables on migration. We find that counties that had experienced fewer disasters received a greater proportion of total migrants in 2005, but there was an overall increase in migration flow to disaster-prone regions as well.