| Issues surrounding urbanization and its implication on agricultural production are important topics in the literature that require further research. The objective of this study is to examine the effect of distance to an urban area on investment in capital stock on dairy farms. Thereby, I will be testing for the 'impermanence syndrome' hypothesis, which suggests farmers will disinvest in agricultural activities in anticipation of the conversion of their farmland to non-agricultural uses.;Regression analysis is used to examine the relationship between investment in dairy farm assets and proximity to urban areas. More specifically, the regression analysis allows for the examination of whether there is a relationship between barn quality and distance to the nearest urban area. Empirical results suggest that distance is not significant in explaining barn quality; therefore results did not support the impermanence syndrome hypothesis. Sensitivity analysis indicated that the results of the specified model are robust to alternative model specifications. |
