2012
DOI: 10.1016/j.labeco.2012.03.004
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Labor supply, income, and welfare of the farm household

Abstract: Considering family labor and hired labor as heterogeneous inputs, we present a theoretical framework in which the optimal decisions of a farm household on on-farm family and hired labor, off-farm labor supply, and leisure are determined uniquely and endogenously. Focusing on two alternative settings with and without off-farm employment constraints, we show that imperfect substitutability between family labor and hired labor is not critical to the separation of household production and consumption. The validity… Show more

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Cited by 28 publications
(29 citation statements)
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References 42 publications
(29 reference statements)
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“…The farm household's decision on time allocation is tripartite: work on‐farm, work off‐farm, and leisure (Ahearn et al., ; Chang, Huang, & Chen, ). We assume that the farm household is a homogeneous price taking unit and solves the following utility ( U ) maximization problem subject to time and budget constraints and existing production technology: Max U=U(Q,0.33emLs)…”
Section: Theoretical Frameworkmentioning
confidence: 99%
“…The farm household's decision on time allocation is tripartite: work on‐farm, work off‐farm, and leisure (Ahearn et al., ; Chang, Huang, & Chen, ). We assume that the farm household is a homogeneous price taking unit and solves the following utility ( U ) maximization problem subject to time and budget constraints and existing production technology: Max U=U(Q,0.33emLs)…”
Section: Theoretical Frameworkmentioning
confidence: 99%
“…Menurut (Chang et al 2012), rumah tangga menyesuaikan penggunaan tenaga kerja untuk pertanian dan nonpertanian. Rumah tangga petani meningkatkan partisipasi di pasar tenaga kerja/ buruh lokal pada kegiatan nonpertanian dalam upaya meningkatkan pendapatan.…”
Section: Pendapatan Dan Pengeluaran Rumah Tanggaunclassified
“…Methodologically, working with shadow wages allows to account for the simultaneity between production and consumption decisions of the household and its members Vijverberg, 1983, 1987;Jacoby, 1993;Skoufias, 1994;Schultz, 1999;Benjamin and Kimhi, 2006;and Chang et al, 2012). Non-separability may arise for several reasons: binding labor time constraints in off-farm employment, imperfect substitutability between family labor and hired labor; farmers or youth preference towards on-farm or off-farm employment, to list a few.…”
Section: Introductionmentioning
confidence: 99%
“…Non-separability may arise for several reasons: binding labor time constraints in off-farm employment, imperfect substitutability between family labor and hired labor; farmers or youth preference towards on-farm or off-farm employment, to list a few. For instance, Chang et al (2012) argued that the validity of the separation method depend crucially on whether the availability of agricultural off-farm jobs is limited or not. As we will show empirically later, in line with Bedemo (2013), the nonseparability assumption best fits the Ethiopian rural setting.…”
Section: Introductionmentioning
confidence: 99%
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