Wage Growth, Landholding and Mechanization in Agriculture Evidence from Indonesia

Futoshi Yamauchi

No 212723, 2015 Conference, August 9-14, 2015, Milan, Italy from International Association of Agricultural Economists

Abstract: This paper examines dynamic patterns of land use, capital investments and wages in agriculture using farm panel data from Indonesia. The empirical analysis shows that with an increase in real wages that prevailed in both agricultural and non-agricultural sectors in rural areas, relatively larger farmers increased the size of operational farm land by renting in land. An increase in real wages has induced the substitution of labor by machines among relatively large farmers. Machines and land are complementary and, consistently, the inverse land-productivity relationship is reversed among relatively large holders.

Keywords: Agribusiness; Land Economics/Use; Research and Development/Tech Change/Emerging Technologies (search for similar items in EconPapers)
Pages: 25
Date: 2015-06
New Economics Papers: this item is included in nep-agr, nep-dev, nep-eff and nep-sea
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Persistent link: https://EconPapers.repec.org/RePEc:ags:iaae15:212723

DOI: 10.22004/ag.econ.212723

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