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Farm Efficiency and Household Labor Supply on Off-farm Employment and their Effect on Farm Sustainability in Fringe Urban Area
Abstract:
This research aimed to conduct economic valuation to farmland in peri-urban area, analyze farmer readiness to leave the farm activity, analyze the attraction of nonfarm sector to the farmers that can influence farmers to leave or maintain their activity in the farm sector, and analyze phenomenon of farm sustainability in Yogyakarta peri-urban area. Contingent valuation method was used in the study. Hypothesis examinations were conducted using ordinal and nominal logistics regression methods.
Results showed that under existing condition, farmers have high total household income per month, high value of farm productivity, and high price of farm level to act in farm activity. In other words, farmers have the tendency to leave their farms if they experience low total household income per month. However, the existence of improved condition does not assure that the farmers would not leave their farms. But under this improved condition, the higher the price of land, the higher the probability that farmers will stay in their farms. Therefore, there is still effective opportunity to improve and develop farm activity in Yogyakarta peri-urban area.
Whether in existing or improved situation, most farmers wished to gain non-farm activity earnings as much as five times more as the earnings of existing farm activity for them to be ready to leave the farm activity. The measurement of sustainability of farm (SF) and level of farm sustainability (LFS) models rather differ, caused by different conceptions and scales of measurement. However, both models could be used to explain the relationship between sustainability of farm in peri-urban area with some social and economic factors.