Farm wealth inequality within and across states in the United States

Ashok K. Mishra, Charles B. Moss, Kenneth W. Erickson

Research output: Contribution to journalArticlepeer-review

1 Scopus citations

Abstract

This paper uses Theil's (1979) entropy-based measure of inequality and farm-level data to examine changes in farm business wealth (farm equity) of farm households. The farms associated with farm households are grouped by state into ten regions of the United States. The Theil entropy measure is then calculated and used to decompose total inequality of farm wealth into within-state and across-states (between states) inequalities for each region. Results show that since the enactment of the 1996 Federal Agricultural Improvement and Reform (FAIR) Act, inequality in farm wealth among farms within a state has decreased relative to the number of farms per state, across all regions. Further, most of the reduction in farm wealth inequality is attributed to increased equality in the distribution of real estate assets of the farm households, a major component of farm wealth.

Original languageEnglish (US)
Pages (from-to)251-264
Number of pages14
JournalAgricultural and Resource Economics Review
Volume35
Issue number2
DOIs
StatePublished - Oct 2006

Keywords

  • Farm household
  • Farm level
  • Farm wealth
  • Inequality
  • Inventories
  • Real estate assets
  • Regional decomposition
  • Theil's inequality

ASJC Scopus subject areas

  • Agronomy and Crop Science
  • Economics and Econometrics

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