ABSTRACT
This chapter examines to what extent incomes of farm households are performing on average compared with those of non-farm households in several Organisation for Economic Co-operation and Development (OECD) member countries. It compares income distribution and poverty between the farm and non-farm communities. Among the three broad areas of concern with respect to agricultural policy, the chapter concentrates on the so-called parity issue. Low and unstable farm income has continuously been used to rationalise public support to farming in many developed countries. An OECD study confirms that, "in most OECD member countries, farm households enjoy, on average, income levels that are close to those in the rest of the society". From various microeconomic studies, Hill proposes different explanations to income inequality among farm households. At country level, average incomes of farm households are close or greater to those of non-farm households in most of the surveyed OECD countries since the 1970s.
