Natural resource characteristics as related to the pattern of agricultural income in certain specified areas of the United States Public Deposited

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  • The main objective of the study was an attempt to obtain a general explanation for the geographical pattern of agricultural income. This was undertaken in the belief that certain possible determinants of agricultural income, specifically those related to natural resource characteristics, have not been satisfactorily considered in investigations up to the present time. Consequently, various determinants which other researchers have found important, e. g., location, education, age, etc. , were combined in one model, together with a number of variables designed to measure various characteristics of natural resources. As far as the natural resource characteristics were concerned, considerable emphasis in this study was placed upon an empirical investigation of the range of choice hypothesis. This hypothesizes that the narrower the range of choice permitted by the natural resource complex, the greater will be the incentive toward specialization and hence higher incomes. Conversely, it was believed that the wider range of choice of enterprises permitted, the greater will be the tendency toward highly diversified, self-sufficient and low income farming units. One of the complications involved in testing the range of choice hypothesis was the desirability of measuring the opportunity for pursuing a number of enterprises rather than the result of producing them. It was believed, however, that one of the more important determinants of the range of choice was the long-run climatic conditions. In order to arrive at climatic measures suitable for the purposes of this study, various modifications were made on those developed by Thornthwaite and Mather. Regression techniques were used extensively for the ensuing empirical investigation, which relied heavily on data from secondary sources. County data for Kansas and Oregon in 1959 and 1960 provided the basis for the bulk of the empirical analysis although some consideration was also directed towards these states for the years 1939 and 1949. Three models, differing only with respect to the climatic measures employed, were constructed consisting basically of two equations. The first equation utilized the median earnings of male farmers and farm managers as the dependent variable together with measures of age, education, race, land capability, irrigation, range of choice and off-farm employment as independent variables. The second equation reflecting earnings from off-farm employment consisted of the percentage of commercial farm operators who work off the farm as the dependent variable and measures of location, time available for off-farm employment, age, race and education as independent variables. The empirical results which were obtained for Kansas and Oregon in 1959 differed in many respects. Most notable was the fact that the range of choice hypothesis was far more significant in Kansas than in Oregon. In addition, the expected decrease in importance of this hypothesis through time did not materialize in either Oregon or Kansas. Possible reasons for this are due to the shortness of the time period studied and that there has been a differential impact of technology. In the first equation, age and education also proved to be significant in both Oregon and Kansas, while in addition in the former state off-farm employment was important, as was irrigation in the latter state. The latter two were also found to have increased in importance over the last 30 years. Empirical results obtained from the second equation revealed that time availability and location were the most important determinants in Kansas and Oregon in 1959. In Oregon, however, evidence was obtained concerning the desirability of modifying the conventional location matrix theory because the unique employment opportunities offered by the lumber industry mean that off-farm employment opportunities are not synonymous with the presence of urban concentrations.
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