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Author: Perry, Janet E.
Resulting in 1 citation.
1. Perry, Janet E.
Returns to Labor from Farm and Non-farm Employment
Ph.D. Dissertation, Oklahoma State University, 1990
Cohort(s): Young Men
Publisher: UMI - University Microfilms, Bell and Howell Information and Learning
Keyword(s): Earnings; Human Capital; Labor Market, Secondary; Modeling, Probit; Occupations; Rural Areas

Choice of occupation is based, in part, on economic considerations such as opportunity costs and comparative advantage. The NLS of Young Men are used to estimate returns to ability for six employment categories including farm workers and operators. Using a human capital model, the log of real annual earnings from the primary employment is regressed on factors hypothesized to affect earnings. An alternative specification of the dependent variable includes the present value of a stream of earnings. Opportunity costs are estimated for the six employment categories. Probit analysis is used to evaluate comparative advantage of workers in agriculture versus other sectors. Results from a 1987 Oklahoma survey of farmers who had ceased farming due to financial reasons are presented. Strategies for improving the economic efficiency of the labor market are proposed. It was found that young men with ties to farming had consistently lower measures of productivity characteristics and lower earnings than the total sample. Investments in human capital yield a positive return to earnings. Probit analysis reveals that workers respond to an expected wage differential between farm and non-farm employment, implying that a worker specializes in the type of work in which he has the comparative advantage. The Oklahoma survey supports earlier findings that farmers experience symptoms of stress when facing farm economic pressures. Respondents were better off for making farm adjustments including finding alternative work. If returns to labor are low in farming and labor can make the transition out of farming, interference in the market creates inefficiencies. Strategies to improve earnings of workers in all employment categories include making investments in human capital and providing information about employment opportunities and wages.
Bibliography Citation
Perry, Janet E. Returns to Labor from Farm and Non-farm Employment. Ph.D. Dissertation, Oklahoma State University, 1990.