Understanding inequality in U.S. farm subsidies using large‐scale administrative data

Abstract

AbstractUsing a large‐scale, individual‐level administrative data set for 2008–2021, we document the inequality in farm program payments across all recipients in the U.S. By examining the relationship between within‐county inequality and demographic characteristics of farmers in a county, we find that there is a positive association between the share of Black operators and within‐county inequality. We also provide suggestive evidence that a substantial portion of racial and gender disparities in farm payments are associated with crop production characteristics. We then utilize name information in farm payment data to infer the race and gender of individual payees. The analysis using approximately 4.9 million payee‐by‐year observations and predicted race and gender information of those payees shows that payments are lower for producers who are Black, Hispanic, and female. Our study provides a comprehensive empirical analysis of the equality of farm subsidy distribution covering most U.S. farm payment programs at a granular level over time. We also provide an empirical approach of utilizing name information from the administrative data that opens up more possibilities for racial and gender inequity research in agricultural economics.