Determinants of work income in Swiss agriculture

The aim of the present regression analysis is to identify the determinants for family work income in agriculture, taking account of social, structural and financial factors in our calculations. The analysis is based on the results for the period 1997-2001 of around 3000 Swiss farms analysed by the Farm Accountancy Data Network of ART. The results of the study are highly diverse, and vary substantially from farm to farm. The highest work income per family labour unit is achieved by the largest farms. Results also attest to the fact that scale effects and better utilisation of production factors allow higher incomes to be achieved on larger farms than on smaller ones. The farm manager’s education also substantially affects the farm’s success. The highest agricultural revenues are achieved by farms whose managers belong to the “Masters or Undergraduate Degree in Agriculture” category. This, however, is to a large extent linked with the size of the farm, which is in turn closely correlated with work income per family labour unit. Finally, the farm manager’s age, type of ownership and extent of indebtedness as well as the number of family employees exert a statistically significant negative influence.