Does agro-processing adoption affect farm income and farm diversification? Empirical evidence from Taiwan

Lin Lin and Hung-Hao Chang

Journal of Agribusiness in Developing and Emerging Economies, 2021, vol. 11, issue 5, 567-577

Abstract: Purpose - The purpose of this paper is to identify the factors associated with the adoption of agro-processing methods and to estimate their impact on farm income and farm diversification. Design/methodology/approach - Using a large-scale sample of 12,122 special crop farm households drawn from the 2015 Agricultural Census Survey in Taiwan, the semiparametric multivalued treatment effect model was estimated. Findings - The authors found that agro-processing farm households obtain higher farm incomes than non-agro-processing farm households. Among the agro-processing methods, self-processing generates higher farm income than outsourced-processing. Moreover, farm households that adopt either agro-processing method are more likely to diversify into agritourism and other agribusinesses than non-agro-processing farms. Research limitations/implications - The authors could only access data on farm income and not on agro-processing costs. Future studies may address the impact of agro-processing on farm profitability if relevant data are available. Originality/value - Very few studies have examined the relationship between agro-processing, farm income and farm diversification. To the best of the authors’ knowledge, this is one of the first papers to examine the impact of different agro-processing practices on farm income and farm diversification.

Keywords: Agro-processing; Farm income; Farm diversification; Taiwan (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jadeep:jadee-07-2020-0157

DOI: 10.1108/JADEE-07-2020-0157

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