Research looks at farm managment

Feb 10, 2012
by WLJ

From 2002 to 2007, the number of operators aged 75 years and older increased by 20 percent, but the number of operators under 25 years of age decreased 30 percent. South Dakota State University (SDSU) researchers Kuo- Liang “Matt” Chang and Soo Hyun Cho say those figures from USDA demonstrate why it is important to understand the factors driving management decisions—including the crucial decision to pass the farm operation to a younger generation.

Chang and Cho will study the issue this year with the help of a $20,000 grant from the Harms Fund for Excellence in Management, one of several donor-funded programs in economics and management that are taking shape as SDSU’s Department of Economics responds to emerging needs in the state and regional economy.

By applying micro-level data from the U.S. Census Bureau’s Survey of Income and Program Participation, or SIPP, the researchers are able to identify challenges farmers face.

“Contrary to numerous neo-classical economic studies of farm survival that focus mainly on the perspective of production efficiency, this project emphasizes the role of family on farmer’s managerial and career decisionmaking,” Cho says. “We are specifically interested in how family wealth, family financial arrangement and familyto-work management affect farmers’ labor participation, retirement decision and migration (exit or entry) patterns.”

For the research, a twoyear, multidisciplinary study will evaluate farmers’ managerial decision-making processes, the family-to-work labor/time arrangement, and inter-generation migration patterns. This project builds on a study that Chang and his colleagues did earlier that looked at health care as a factor in farmers’ decisions to exit the workforce.

Chang is an assistant professor in SDSU’s Department of Economics. Cho is an assistant professor in SDSU’s Department of Consumer Sciences.

In addition to supporting this research, the Harms Fund for Excellence in Management, established by SDSU Department of Economics alumnus Duane Harms, president and owner of Brookings-based Harms Oil Co., is also providing $15,000 for a separate project that prepares SDSU students as management interns to work on economic development issues in South Dakota Horizons Program communities. SDSU’s Department of Economics is supplying a matching contribution to each of the projects. —By Kindra Gordon for SDSU College of Agriculture & Biological Sciences