Boarded up storefronts and empty main streets haunt rural communities across the Great Plains.
Larger farms are blamed. Conventional wisdom says that as farms grow larger to increase efficiency, fewer people farm. Fewer people means less support for small town businesses. A downward spiral develops. Stores close, people move on.
Research by IANR agricultural economists suggests, however, that it's small towns' economies that affect farm size more than farm size affects small towns.
"We're arguing that the forces going on here come more from the non-farm sector," said Glenn Helmers, NU agricultural economist.
Instead of a one-directional relationship, where farm size drives all the changes in rural communities, Helmers, Joseph A. Atwood, an agricultural economist at Montana State University, and NU graduate student Shaik Saleem found a strong relationship between local non-farm and farm economies.
They set out to answer the question "which came first, larger farms or declining rural communities," with a hypothesis that employment opportunities significantly affect farm size.
They analyzed 1980 and 1990 census data from 400 counties in Nebraska, Iowa, Kansas and Missouri and looked at two variables--off-farm wages and employment density--to determine the economic factors driving changes in rural communities.
They found average farm size is smaller in areas where local off-farm jobs are available.
The area around Lincoln, dotted with small farms, is a good example. Because jobs are available, many farmers work full or part time off the farm, but they keep their farms.
"Near a metropolitan area, where farmers may work full time off the farm, farms may be very small--80 to 160 acres," Helmers said. "In other dryland corn areas, a small farm would be 240 to 320 acres."
When the only employment opportunity a rural area offers is farming, farmers have little choice but to make it pay well, Helmers said. They expand by buying more farms.
Helmers and his colleagues also found that farm sizes were larger in areas where local wages were high, but only a limited number of jobs were available. If only a few high-paying off-farm jobs are available, farmers expand their operations to generate a higher standard of living similar to their neighbors who work off the farm, Helmers said.
These findings are important because they can influence how agricultural programs are targeted. Traditionally, federal farm programs emphasized increasing farm profitability as a way to keep people farming and to maintain smaller farms.
"Our research would suggest that more resources be aimed at developing rural communities," Helmers said. "Increasing rural employment opportunities may be a better way to encourage people to stay on the farm."
--Monica Manton Norby