Reservation Wage for the Sustainability of Agricultural Employment

Agriculture is strategically important due to its effects on employment, rural welfare, and food security. However, the sustainability of agricultural employment depends not only on production and productivity but also on farmers’ decisions to remain in or leave the sector. In job search theory, the reservation wage refers to the minimum wage an individual is willing to accept to work. This study aims to determine the minimum income level at which farm operators would be willing to leave agriculture and work in other sectors. The research was conducted with 381 farm enterprises in Konya Province, Türkiye, using a stratified random sampling method. The findings indicate that the average monthly reservation wage required for farm operators to exit agriculture is 9,461.87 TL (571.36 USD based on the 2022 average exchange rate). This amount corresponds to approximately 1.94 times the average net minimum wage in 2022. The results show that the decision to leave agriculture is influenced not only by production costs but also by income instability, price volatility, and institutional uncertainty. The study suggests that the reservation wage can be considered a micro-level indicator reflecting income instability in agriculture.