Characterizing US dairy farm income and wealth distributions

Joleen C. Hadrich, Christopher A. Wolf, Kamina K. Johnson

Research output: Contribution to journalArticle

1 Citation (Scopus)

Abstract

Purpose: The structural change of the dairy industry has been a long-term process with fewer, larger dairy herds in all regions. The purpose of this paper is to evaluate whether this structural change is leading to less income and wealth equality across dairy farms and how these factors differ across the USA. Design/methodology/approach: Income and wealth inequality of US dairy farms was estimated by Gini coefficients using data from the 2000 and 2010 ARMS dairy costs and returns data. A population-level quantile regression was estimated at decile increments to determine the factors that affect net farm income (NFI) and net worth (NETW) and if they changed across the time periods. Findings: Adjusted-Gini coefficients were estimated and indicated that income inequality was greater than wealth inequality across US dairy farms. Results of the quantile regressions confirm regional differences exist with dairy farms in Mountain regions consistently having lower NFI and NETW relative to farms in the Lake States region when factors such as herd size were equal. Life cycle effects were not observed for NFI, but present within NETW estimates across the ten years. Originality/value: This analysis estimates industry-specific-adjusted Gini coefficients to determine if income and wealth inequality exist.

Original languageEnglish (US)
Pages (from-to)64-77
Number of pages14
JournalAgricultural Finance Review
Volume77
Issue number1
DOIs
StatePublished - Jan 1 2017

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income and wealth
farm income
net farm income
dairy farming
herd size
dairy industry
dairy herds
dairies
Dairying
income
mountains
industry
lakes
farms
Income distribution
Wealth distribution
Farm income
Dairy farms
Farms
Lakes

Keywords

  • Dairy
  • Gini coefficient
  • Income inequality
  • Quantile regression
  • Wealth distribution

Cite this

Characterizing US dairy farm income and wealth distributions. / Hadrich, Joleen C.; Wolf, Christopher A.; Johnson, Kamina K.

In: Agricultural Finance Review, Vol. 77, No. 1, 01.01.2017, p. 64-77.

Research output: Contribution to journalArticle

Hadrich, Joleen C. ; Wolf, Christopher A. ; Johnson, Kamina K. / Characterizing US dairy farm income and wealth distributions. In: Agricultural Finance Review. 2017 ; Vol. 77, No. 1. pp. 64-77.
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