Does Non-Farm Income Raise Farm Productivity? New Evidence from India.

On the face of various agro-climatic shocks, farmers often resort to non-farm activities as a coping mechanism for attaining sustainable livelihood. While the impact of non-farm income on farm productivity is well documented in the literature, we contribute to the literature by exploring the possibi...

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Publicado en:Journal of Development Studies Vol. 61; no. 9; pp. 1526 - 1548
Autores principales: Drall, Anviksha, Mandal, Sabuj Kumar
Formato: Artículo
Publicado: Taylor & Francis Ltd Sep2025
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Acceso en línea:Ver este registro en EBSCOhost
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      dt: Sep2025
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        10.1080/00220388.2025.2467661
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        atl: Does Non-Farm Income Raise Farm Productivity? New Evidence from India.
      aug:
        au:
          Drall, Anviksha
          Mandal, Sabuj Kumar
        affil:
          Department of Social Sciences, National Law School of India University, Bengaluru, India
          Department of Humanities and Social Sciences, Indian Institute of Technology Madras, Chennai, TN, India
      su:
        India
        Econometric models
        Rural development
        Heterogeneity
        Agricultural productivity
        Farm income
        Landowners
      sug:
        subj:
          Econometric models
          Rural development
          Heterogeneity
          India
          Administration of Urban Planning and Community and Rural Development
          Agricultural productivity
          Farm income
          Landowners
      keyword:
        farm productivity
        non-farm income
        non-linearity
        farm productivity
        non-farm income
        non-linearity
      ab: On the face of various agro-climatic shocks, farmers often resort to non-farm activities as a coping mechanism for attaining sustainable livelihood. While the impact of non-farm income on farm productivity is well documented in the literature, we contribute to the literature by exploring the possibility of a non-linear impact of non-farm income on farm productivity - differential impact across different types of farmers (small, medium and large) based on their landholding size. We first develop a small theoretical model and establish various channels which could result in non-linearity. For empirical estimation, we use household-level information from eight Indian states based on Village Dynamics in South Asiapanel dataset for a period of five years (2010–2014). We adopt an Instrumental Variable Tobit Model to correct for endogeneity of non-farm income arising from unobserved heterogeneity and simultaneity between non-farm income and farm productivity. Our empirical results unveil a U-shaped relationship between non-farm income and farm productivity. This confirms our hypothesis about non-linear impact of non-farm income on farm productivity. Our heterogeneity analysis shows that the impact of non-farm earnings on farm productivity varies with size of landholdings. Policy implications of our empirical results are also discussed.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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