The irrelevance of stated plans in predicting farm successions in Finland

Väre, Minna; Pietola, Kyösti; Weiss, C.

doi:10.2137/145960610791015041

Cited by 19 publications

(13 citation statements)

References 24 publications

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“…10. Exceptions analyzing ex-post (actual) succession decisions using panel data are studies by Kimhi (1994), Kimhi and Bollman (1999), Stiglbauer and Weiss (2000) and Väre et al (2010). 11.…”

Section: Resultsmentioning

confidence: 99%

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Trapped in Agriculture? Credit Constraints, Investments in Education and Agricultural Employment

2014

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The basic neo-classical model implies that agricultural employment responds positively to increases in farm income. This argument is assumed by proponents and critics of agricultural subsidy programs in their discourse in favor of or against government support for farmers. However, empirical evidence on the relationship between agricultural employment and farm income (and subsidies) is mixed, and some studies find evidence that an increase in farm income has a negative impact on agricultural employment. This article proposes a new explanation for this puzzle. When farm income increases, part of the additional income is invested by credit-constrained farmers in their children's education and educated children are less likely to become farmers themselves. We provide a theoretical model and empirical evidence supporting this argument.Le modèle néo-classique de base part du principe que l'emploi agricole réagit positivement à l'augmentation des revenus fermiers. Cet argument est proposé par les défenseurs et les critiques des programmes de subventions agricoles, lorsqu'ils se positionnent pour ou contre le soutien gouvernemental aux fermiers. Cependant, les preuves empiriques sur la relation entre emploi agricole et revenus fermiers (et subventions) sont mitigées, et quelques études ont trouvé qu'une augmentation des revenus fermiers a un impact négatif sur l'emploi agricole. Cet article propose une nouvelle explication à ce problème. Lorsque les revenus fermiers augmentent, une partie de ces revenus supplémentaires est investie par des fermiers, limités par les contraintes de crédit, dans les études de leurs enfants. Les enfants ayant fait des études sont moins susceptibles de devenir eux-mêmes des fermiers. Nous fournissons un modèle théorique et des preuves empiriques pour appuyer cet argument.

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Section: Resultsmentioning

confidence: 99%

“…10 In general, there are substantial differences between stated and revealed behavior of children, which may cause a 'generation bias' in the analysis (Väre et al, 2010).…”

Section: Empirical Framework Datamentioning

confidence: 99%

Trapped in Agriculture? Credit Constraints, Investments in Education and Agricultural Employment

2014

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“…The event of family business transfer in the sample was treated as a dichotomous variable, inferred from farm-holder expectation on whether farm succession would take place in the future. It is worth remembering that such expectations may not result in actual behaviour (Väre et al 2010). As the aim of the analysis was to explore the improvement in farm succession estimations brought by labour market and surrounding conditions (LMSC) variables, in comparison to farm and farmer features, both the former and the latter have been selected as explanatory variables.…”

Section: Data and Variablesmentioning

confidence: 99%

“…This type of event may be observed directly (following a sample or a population of farms over a long time span, Stiglbauer and Weiss 2000) or may be inferred by asking a farmer his/her expectations about farm transfer (Glauben et al, 2004). In the former case, the information is more reliable, while data based on farmer statements may be inconsistent with respect to the actual event of succession (Väre et al 2010). Most of the analyses have been carried out at the farm level, while few have focused on the probability that each potential heir in a family farm will take over the farm (Simeone 2006;Mann 2007;Aldanondo Ochoa et al 2007).…”

Section: Introductionmentioning

confidence: 99%

Does the future of a farm depend on its neighbourhood? Evidence on intra-family succession among fruit and vegetable farms in Italy

et al. 2019

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The transfer of farm activity over time occurs through different pathways, among which the more frequent is intra-family farm succession. Thus, better information on farm succession determinants is crucial for understanding farm succession and informing appropriate sectoral policies. To date, substantial research has focused on the effect of farm, farmer and potential heir features on farm succession, while the role played by socioeconomic conditions around a farm has been relatively less examined. Building on previous contributions, the present paper considers farm succession as the opposite of labour migration out of the agricultural sector. Thus, the effect of the labour market and surrounding conditions (LMSC) around a farm on its succession probability is explored. The aim of this paper is therefore to explore whether and to what extent the inclusion of LMSC variables may contribute to a better understanding of farm succession. Using data from a sample of 266 fruit and vegetable farms (gathered for informative purposes by a producers' organization consortium), empirical evidence that LMSC variables play an important role in explaining the succession probability in these types of farms is provided. Specifically, the results show that (i) including LMSC variables in a farm succession analysis increases the explanatory power and robustness of the model estimates; (ii) LMSC variables have a non-linear effect on succession; and (iii) some explanatory variables (farmer education and farm age, specialization and dimension) are significant across various specifications, while other variables (farmer age, territorial location and distance of a farm from its producer organization) change their sign and/or significance when LMSC variables are included in the model. As a consequence, our findings suggest that LMSC variables should be included in farm succession and labour market analysis to provide a better estimate of farm succession probability.

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“…A second group of variables included in almost all studies comprises various indicators of farm income (Hennessy, 2002;Mishra et al, 2010), also including Standard Gross Margin (Glauben et al, 2004;Corsi, 2009), farm area (Kimhi and Nachlieli, 2001;Hennessy, 2002;Väre et al, 2010), livestock units (Stiglbauer and Weiss, 2000), and profits (Glauben et al, 2009). The majority of the studies find a significant and positive effect on succession (only for Mishra et al 2010, and for Väre et al, 2010 the relevant estimate is not significant).…”

Section: The Determinants Of Successionmentioning

confidence: 99%

Succession decisions in family farms and public policies in developed countries

Corsi¹

2017

Public Policy in Agriculture

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This paper presents a review of the literature on family farm succession in developed countries. It starts with a presentation of the different, and conflicting, theoretical models of succession, then analyzes the empirical work on the determinants of family succession, of its timing, and on the effects of succession on farm performances. The policies affecting family farm succession are presented, with an emphasis on inheritance rules and on agricultural policies.

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The irrelevance of stated plans in predicting farm successions in Finland

Cited by 19 publications

References 24 publications

Trapped in Agriculture? Credit Constraints, Investments in Education and Agricultural Employment

Trapped in Agriculture? Credit Constraints, Investments in Education and Agricultural Employment

Does the future of a farm depend on its neighbourhood? Evidence on intra-family succession among fruit and vegetable farms in Italy

Succession decisions in family farms and public policies in developed countries

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