Chapter 4 - Equilibrium and Immigration in the Farm Labor Market

Abstract

This chapter combines principles of farm labor supply and demand to show how interconnected local labor markets interact and reach equilibria that are both seasonal and spatial. They are seasonal because the demand for labor tends to be concentrated in only a few months of the year, usually around harvest time. They are spatial because harvests happen at different times of year for different crops and in different regions. In high-income countries, farmers rely heavily on immigrant workers to appear at the farm just in time to harvest the crop, and many workers rely on follow-the-crop migration to piece together employment throughout the course of the year. Farm workers’ willingness to engage in follow-the-crop migration is critical to the functioning of local farm labor markets. The interaction of labor supply and demand determines the equilibrium wage and employment in a given farm labor market at a given time of year. Follow-the-crop migration helps spread labor across crops and space.