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INVESTIGATOR: Khanal, A. R.

PERFORMING INSTITUTION:
TENNESSEE STATE UNIVERSITY
3500 JOHN A. MERRITT BLVD
NASHVILLE, TENNESSEE 37209

ENHANCING ECONOMIC BENEFITS AND SUSTAINABILITY OF SMALL FARM BUSINESSES IN TENNESSEE THROUGH ENTERPRISE DIVERSIFICATION AND AGRITOURISM

NON-TECHNICAL SUMMARY: Small farming businesses face great challenges for continuation and survival using conventional commodity production methods. Small farms are often unable to adopt improved technology, new managerial practices, and intensive cultivation to keep pace with competitive large farms. Enterprise diversification is an important risk management tool and an effective strategy for mitigating income risk. With growing emphasis on diversification and structural adjustment, there is an increasing interest in developing agritourism. The goal of this three year project is to analyze and evaluate viable strategies for sustainability of small farms in Tennessee. Both primary and secondary data will be used. The specific objectives are: (1) investigate the structural factors affecting agritourism location in Tennessee; (2) analyze factors influencing farm households' decision to participate in agritourism and enterprise diversification and quantify the impact of the decision on farm household's economic and financial performance; (3) examine the adoption of best management practices (BMPs) in agritourism and the role of demographic and socio-economic factors in adoption of BMPs; (4) estimate the economic impacts of agritourism and related agricultural and recreational services industry on Tennessee economy; and (5) create and publish online- and printed- outreach materials to disseminate findings. The project will also provide experiential learning opportunity for students. Project will advance knowledge about enterprise diversification and agritourism, and their impacts on farm- and State- level economies. The project builds capacity at Tennessee State University, particularly advancing new area of research in economics of alternative agricultural enterprises, profitability, impact, and efficiency evaluation, and quantitative decision analysis.

OBJECTIVES: The overall research goal of the project is to assess factors influencing adoption of enterprise diversification and agritourism and their role and impact on economic and financial performance on small farms in Tennessee and to assess the impact of these sectors to the State economy. The specific objectives are: (1) To investigate the structural factors affecting agritourism location in Tennessee; (2) To analyze factors influencing farm households' decisions to participate in agritourism and enterprise diversification activities and quantify the impact of the decision on farm household's economic and financial performance; (3) To examine the adoption of best management practices (BMPs) in agritourism and the role of demographic and socio-economic factors in adoption of BMPs; (4) To estimate the direct, indirect, induced, and total regional economic impact of agritourism, and related agricultural and recreational service industry on the Tennessee economy; and (5) To create and publish online- and printed- outreach materials to educate and disseminate findings.