Abstract

AbstractThis chapter examines the extent to which increased income inequality in the USA may have altered the supply of labour to agriculture. An aggregate model of the hired farm labour market is estimated, incorporating minimum wage effects in addition to the changes in income distribution. The results suggest that the widening income distribution has not significantly affected the supply of labour to agriculture. The level of non-farm wages is found to have a strong negative effect on the supply of farm labour. Farm labour supply is highly elastic with respect to the farm wage rate, and farm labour demand is highly inelastic.

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