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Rates of Return in the Farm and Nonfarm Sectors: How Do They Compare?

Published online by Cambridge University Press:  28 April 2015

Kenneth W. Erickson ,
Charles B. Moss  and
Ashok K. Mishra
Kenneth W. Erickson
Affiliation:
Farm Structure Performance and Weil-Being Branch of the United States Department of Agriculture, Washington, D.C.
Charles B. Moss
Affiliation:
Food and Resource Economics Department, University of Florida, Gainesville, FL
Ashok K. Mishra
Affiliation:
Farm Structure Performance and Weil-Being Branch of the United States Department of Agriculture, Washington, D.C.
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Abstract

This study examines the return on agricultural assets relative to nonfinancial corporate assets in the general economy using aggregate Bureau of Economic Analysis data. Our results indicate that the rate of return on nonfarm assets dominates the rate of return on agricultural assets. The average rate of return on nonfarm assets is higher than the average rate of return on farm assets, and the variance of the rate of return on nonfarm assets is lower than the variance of the rate of return on farm assets. Furthermore, the rate of return on agricultural assets only exceeds the rate of return in the nonfarm sector in 1992.

Keywords

Farm sector accountingnonfarm incomenonfarm sectorrate of returnreturns to farm assetsQ14Q18
Type
Articles
Information
Journal of Agricultural and Applied Economics , Volume 36 , Issue 3 , December 2004 , pp. 789 - 795
Copyright
Copyright © Southern Agricultural Economics Association 2004

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