Journal of Agricultural and Resource Economics
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This study tests for structural change in the poverty-farm employment relationship between 1980 and 1990. Econometric findings from a partially simultaneous block triangular regression model estimated with census data reveal a circular relationship between farm employment and immigration that was associated with a significant decrease in the number of people in impoverished U.S. households in 1980. However, in 1990, the farm employment-poverty relationship reversed: an additional farm job was associated with an increase in poverty. Our findings suggest immigration to fill low-skilled farm jobs is transferring poverty from rural Mexico to communities in the United States.
When welfare reforms were enacted in 1996, a higher than average percentage of residents in the agricultural heartland of California, the San Joaquin Valley, received cash assistance. Average annual unemployment rates during the 1990s ranged from 12% to 20%, and 15% to 20% of residents in major farming counties received cash benefits. This analysis develops and estimates a two-equation cross-sectionally correlated and timewise autoregressive model to test the hypothesis that in agricultural areas, seasonal work, low earnings, and high unemployment, as well as few entry-level jobs that offer wages and benefits equivalent to welfare benefits, promote welfare use and limit the potential of local labor markets to absorb ex-welfare recipients.
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