Many investigators have surmised that reduced-chemical and organic crop production require the input of a higher level of human capital than does conventional production. But no previous study has measured and compared whether the amounts of human capital growers use in managing their production systems differ across those systems. To provide the first measure of the time investment made in human capital by conventional and reduced-chemical farmers, we conducted a survey of 1000 Illinois households to obtain estimates of the amount of time spent by these different types of farmers to accumulate the human capital needed in their management practices. Conventional farmers reported spending just over 3 h week–1 ’keeping up‘ with information about their production practices, while reduced-chemical and organic farmers reported a time investment of nearly 4 h week–1. This difference was found to be statistically significant, suggesting that chemical inputs and human capital may be economic substitutes. Farmers who adopted reduced-chemical practices reported a transition period of 1–2 years; during this period, they spent around 3 h week–1 learning about reduced-chemical technology. Adopters of organic practices also reported a transition period of 1–2 years; during this period, they invested 5 h week–1 learning about organic technology. The quantitative results of this study will be useful for future empirical work that investigates the potential costs and benefits of using subsidies to induce conventional farmers to switch to alternative production practices.

Interest in organic dairying is increasing at a rapid pace in California, and the demand for organic milk and dairy products is growing even faster. The intent of this study was to determine the cost of organic milk production, and in particular, to determine the differences in cost of production of organic and conventional milk. Primarily we are interested in whether the differences are due to government-mandated requirements or whether they are the result of optional procedures or personal preferences. Previous studies have indicated that under organic production, the higher net returns observed on organic farming enterprises are due mainly to the lower cost of production. This conclusion is not sustained here. Our results show that the total cost of production on a per cow and a per hundredweight basis is 10–20% higher for organic producers than for conventional producers. While not strongly statistically significant, the differences appear to be due to higher feed costs, higher average labor costs, significantly higher herd replacement costs, and significant transition costs

A farming systems trial has been conducted at the Rodale Institute Research Center in Kutztown, Pennsylvania since 1981. Over time, the organic rotation has changed to reflect improved knowledge and experience. The current, three-year rotation (hairy vetch/corn, rye/soybeans, and wheat) focuses on mechanical tillage for weed control and year-round live plant cover for pest control and nutrient supply. We constructed long-term enterprise budgets for the organic and conventional cash grain rotations and compared returns earned during the first years of the study, which for the organic rotation involved investment in soil capital, with returns during two later 5-year periods. The organic rotations during these two later periods produced com and soybean yields comparable with the conventional rotation, but grew higher-value crops less frequently and required more family labor and management. The differences in the profitability of the conventional and organic farming systems depend on whether the analysis includes the initial investment in building up the soil and the value of family labor.