Higher Off-farm Income Enables Farmers to Burrow More and Increase Investment in Their Operations
2022
Key, Nigel
Most agricultural lenders extend loans based on their assessment of a borrower's ability to repay debt. Because of this, some farmers may not be able to secure as much credit as they would like fore their farm businesses. A lack of credit could prevent these farmers from expanding production or could restrict investments in productivity-enhancing technologies. Off-farm income may help some farm households quality for larger loans, which could lead to higher farm output, productivity, and profit.
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