Theoretical and empirical models are developed to examine the off‐farm wages, labor force participation, and hours of work of farmers. Econometric estimates use data from a 1971 survey of Illinois farmers. The off‐farm wage depends on farmer human capital and the local labor market. The major result confirms the. sensitivity of off‐farm work to economic incentives. A 10% increase in the off‐farm wage entails an 11% increase in hours of off‐farm work holding farm characteristics constant. Results also indicate effects of seasonality, risk, and life cycle factors on off‐farm work.
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Daniel A. Sumner (1982) studied this question.
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