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Factors affecting farm enterprise diversification

Agricultural Finance Review

ISSN: 0002-1466

Article publication date: 1 November 2004



Enterprise diversification is a self‐insuring strategy used by farmers to protect against risk. This study examines the impact of various farm, operator, and household characteristics on the level of onfarm enterprise diversification. Evidence exists that larger farms are more specialized. Also, farmers who participate in off‐farm work, farms located near urban areas, or farms with higher debt‐to‐asset ratios are less likely to be diversified. In contrast, evidence suggests there is a significant positive relationship between diversification and whether the farm business has crop insurance, is organized as a sole proprietorship, or receives any direct payments from current farm commodity programs.



Mishra, A.K., El‐Osta, H.S. and Sandretto, C.L. (2004), "Factors affecting farm enterprise diversification", Agricultural Finance Review, Vol. 64 No. 2, pp. 151-166.



Emerald Group Publishing Limited

Copyright © 2004, Emerald Group Publishing Limited

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