Revealing an Equitable Income Allocation among Dairy Farm Partnerships

Jonathan B. Dressler and Loren W. Tauer

No 126542, Working Papers from Cornell University, Department of Applied Economics and Management

Abstract: We formulate a method to determine an equitable division of dairy farm partnership income when partners provide unequal amounts of capital, labor, and management and empirically estimate this relationship. New York dairy farm financial data are used within fixed effects and random coefficient panel regression models to reveal a systematic division of dairy farm partnership income among operators’ labor, capital, and management while controlling for heterogeneity arising from differing herd size. Results indicate that controlling for time and heterogeneity across farms due to herd size are important factors when dividing net farm income among unpaid factors of production. Empirical estimates of allocating dairy farm partnership income to equity, operators’ labor, and management are presented.

Keywords: Agribusiness (search for similar items in EconPapers)
Pages: 30
Date: 2011
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Related works:
Working Paper: Revealing an Equitable Income Allocation among Dairy Farm Partnerships (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:cudawp:126542

DOI: 10.22004/ag.econ.126542

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