The Impact of Labor and Hiring Decisions on the Performance of U.S. Organic Farms

Summary

An increased emphasis on the viability and growth of local food systems which reduce "food miles" has promoted efforts encouraging farmers and processors to sell and distribute food products to local consumers. The elasticity of complementarity is used to predict adjustments in relative wage payments if organic farmers commit to local selling. We use comprehensive U.S. data on organic practices to show that a commitment to local sales leads to lower organic farm incomes. Policies that promote a shift to local sales would lead to decreased use of seasonal workers and higher wages for seasonal workers with smaller adjustments in the wages of year-round workers.