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Farm subsidies and agricultural employment: The education channel

Ruxanda Berlinschi, Kristine Van Herck () and Johan Swinnen ()

No 99424, 122nd Seminar, February 17-18, 2011, Ancona, Italy from European Association of Agricultural Economists

Abstract: Agricultural employment in industrialized countries has been steadily decreasing despite important levels of farm subsidies. We argue that one explanation to this puzzle is the positive impact of subsidies on the education levels of farmers’ children. If farmers are credit constrained, they may underinvest in their children’s education. By increasing farmers’ revenues, subsidies increase investment in education. If more educated children are less willing to become farmers, one long term effect of subsidies is to reduce labor supply in the agricultural sector. We provide a theoretical model and some empirical evidence supporting this argument.

Keywords: Agricultural; and; Food; Policy (search for similar items in EconPapers)
Pages: 23
Date: 2011-02-10
New Economics Papers: this item is included in nep-agr and nep-lab
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Working Paper: Farm Subsidies and Agricultural Employment: The Education Channel (2011) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:ags:eaa122:99424

DOI: 10.22004/ag.econ.99424

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