Purpose -For many farm families and operators across the OECD countries, off-farm income has become a major determinant of their well-being. The purpose of this paper is to investigate the potential role of off-farm employment as a risk management tool among farm operators. Design/methodology/approach -A two-part model is applied to a longitudinal farm-level data set for about 20,000 Canadian farms, from 2001 to 2006, in order to estimate the relationship between farm income risk and the decision to participate in the off-farm labor market and the level of off-farm employment income. Findings -The variability of farm market revenue is found to be positively related to the likelihood of off-farm work and the level of off-farm employment income, in particular for operators of relatively large farms. Hence, farm operators' production decisions appear to be conditioned on an income portfolio that includes a substantial amount of off-farm income for all sizes of farms. Social implications -These results reinforce the need to consider the portfolio effect induced by the integration of farm resources within the non-farm sector. This is particularly relevant to risk management farm policies that have typically considered decisions made in the agricultural sector in isolation. Originality/value -This paper uses a true farm-level panel data set to investigate the relationship between farm income risk and off-farm work. The size of the data set also allows the robustness of the results across farm typologies and size to be tested. This study contributes to the understanding of structural changes in the farm sector, and their potential implications for both rural and agricultural policies.

The substitution between rural labor and machinery has been a key determinant of farm production, structure, and efficiency in most developed countries and is expected to play a key role in shaping the future of Chinese agriculture. Using disaggregated farm-level data from Hebei and Shandong provinces of China, we calculated the Allen and Morishima elasticities of substitution between labor and machinery. These elasticities were based on seemingly unrelated regressions and three-stage least squares estimates of the translog cost function and input cost share functions. In contrast to previous studies, we dissaggregate machinery inputs into three categories: large, medium, and small. In addition, the issue of endogeneity in output quantity and input prices is also addressed. The results show strong evidence of substitution between labor and the three categories of machinery inputs. The findings also support substitution among the three categories of machinery themselves. La substitution entre la main-d'oeuvre agricole et la machinerie constitue un déterminant fondamental de la production, de la structure et de l'efficacité des exploitations agricoles dans la plupart des pays développés et elle devrait jouer un rôle clé dans l'évolution de l'agriculture chinoise.À l'aide de données désagrégées sur les exploitations agricoles situées dans les provinces chinoises de Hebei et de Shandong, nous avons calculé lesélasticités de substitution d' Allen et de Morishima entre les facteurs de la main-d'oeuvre et de la machinerie. Le calcul de cesélasticités est basé sur des régressions apparemment indépendantes (SUR) et sur la minimisation des moindres carrés en troisétapes (3SLS). Contrairement auxétudes antérieures, nous avons subdivisé la machinerie en trois catégories : grosse, moyenne et petite. Nous avonségalement examiné l'endogénéité de la quantité d'extrants et des prix des intrants. Les résultats de notreétude illustrent clairement la substitution entre la main-d'oeuvre et les trois catégories de machinerie et appuient aussi la substitution entre les trois catégories de machinerie.

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