Is Farm Management Skill Persistent?

Agricultural producers operate in a volatile environment, facing a number of sources of risk. A key question is whether farmers who are more highly skilled can better mitigate these risks and consistently earn higher returns than their lower skilled peers. In this article, farm management performance is analyzed based on yearly Illinois Farm Business Farm Management (FBFM) panel data across 6,760 farms from 1996 through 2011. Two out-of-sample measures of skill are used to analyze the ability of farm managers that consistently perform well over yearly and longer time horizons. Results suggest that the most skilled managers often generate better financial results. Furthermore, persistence tests show management skills are consistent and predictable.


Subject(s):
Issue Date:
2015
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/212047
Total Pages:
23
JEL Codes:
Q12; Q13; M11




 Record created 2017-04-01, last modified 2017-04-26

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