A tremendous amount of attention and research has been devoted to the impacts of farm scale on rural communities. The majority of this research follows in the "Goldschmidt" tradition. Walter Goldschmidt is an anthropologist who in the 1940s made the finding that communities surrounded by large-scale farms faired poorly, in a number of important social indicators, when compared to communities surrounded by small-to-moderate sized farms. Since Goldschmidt's research, a plethora of studies have been undertaken to attempt to replicate or refute his findings. The "follow-up" studies employ a diverse set of methodologies, data sets, units of analysis and variables. However, in. general, the majority of the studies provide at least some support for Goldschmidt's original findings.

The impetus behind Goldschmidt's original research and subsequent studies is the effort to understand the nature and impacts of structural change in U.S. agriculture. Since early in the 20^th century, U.S. agriculture has been increasingly characterized by a loss in farm numbers, increasing average farm size, increasing use of hired labor on farms, vertical integration of farming with off-farm businesses and upsurges in contract farming. These changes have been uneven across time and place, but in general have characterized the development of U.S. agriculture in the 20^th and early 21^st centuries, and have caused some observers to argue that agriculture is "industrializing".

In addition to generating academic research, concerns over structural change in U.S. agriculture have also generated public policies. For example, nine Midwestern states have adopted laws that restrict corporate involvement in agriculture. The nine states are Iowa, Kansas, Minnesota, Missouri, North Dakota, Oklahoma, South Dakota and Wisconsin. The laws were primarily put into place between 1974 and 1975 for all states but Nebraska. Nebraska's constitutional amendment (Initiative 300 or I-300) restricting corporate agriculture was adopted in 1982. The laws, called anti-corporate farming laws, vary from state to state but in general are intended to hobble or restrict corporate involvement in agriculture in order to protect family farm agriculture.

Anti-corporate farming laws are not necessarily intended to slow down or stop many of the changes occurring in U.S. agriculture. For example, the laws do not address issues around hired labor or increasing scale of the farming units in general. Rather, the laws are designed to regulate or proscribe the entry of particular types of organizational forms based on ownership arrangements, most commonly non-family corporations, into production agriculture.

This is accomplished through actions such as restrictions or regulations on ownership of farmland or downward vertical integration of livestock processing with production. It is often thought that unincorporated farming units might find it difficult to compete with incorporated farming units, because the latter enjoy liability advantages and possibly advantages in other areas such as acquiring financing and paying taxes. Our purpose in this study is to investigate what impacts, if any, these anti-corporate farming laws have had on rural communities.

To test the impacts of the anti-corporate farming laws we construct two variables: a binary variable for whether a state has such a law or not; and a restrictiveness index that allows us to compare states with more restrictive laws to those with less restrictive laws. In addition, a number of control variables are included in the analysis. The controls are used in order to attempt to isolate the effects of the variables of interest: in this case the anti-corporate farming variable impacts on rural community welfare. The control variables are those variables that might be considered as important determinants of rural community welfare and have to be included in order for an analysis to rigorously attempt to test for relationships of interest. Rural community welfare is measured by three variables: percent of families in poverty, percent unemployed and percentage of farms in a county realizing cash gains.

In addition, we use data from the 1982 and 1992 Censuses of Agriculture to construct a measure of large scale, absentee owned (industrial style) farming in a county. We label this measure the farm scale factor and include it in the analysis primarily as a control variable but also to inform the scholarship in the Goldschmidt tradition. However, our analysis of industrial farming or farm scale relative to rural community welfare differs from previous analyses since we test to determine if lower and higher levels of industrial farming, as measured by the farm scale factor, have differing impacts on rural community welfare.

The results of the analysis indicate that, in general, agriculture dependent counties in states with anti-corporate farming laws fared better (less families in poverty, lower unemployment and higher percentages of farms realizing cash gains) than agriculture dependent counties in states without such laws. When we compare states with more restrictive anti-corporate laws to states with less restrictive laws, the results are similar, though much less consistent, to comparing states with laws to states without laws.

The results also suggest that rural communities tend to benefit from lower levels of agricultural industrialization but might fare poorly as agricultural industrialization intensifies and begins to dominate a county's agriculture. We conclude that diversity in agricultural structural forms at the county level appears to have positive impacts on rural communities as measured by poverty, unemployment and farm cash returns. Counties appear to require some agricultural industrialization to prosper but suffer when this type of agriculture crowds out less industrialized forms.

A public policy intervention that promotes organizational and structural diversity in agriculture would seem to be needed. In this vein, anti-corporate farming laws provide one model. These laws vary across states but in general have been designed to attempt a balance between allowing for economic flexibility of farm firms and protecting family-based agriculture.

The laws are designed to allow farm firms to incorporate but only under certain restrictions and limitations. Some laws restrict the number of shareholders, other laws require that at least one owner also regularly work on the farm, and still others restrict the ability of certain types of corporations to feed livestock. There are of course other models for regulating industrial agriculture and for providing sheltering institutions for less industrialized forms. However, the relatively extensive experience U.S. agriculture has had operating with such laws; and the fact that the laws appear to have had some of the beneficial impacts that their authors and proponents intended, make the laws interesting and thought provoking starting points for public policy development and debate concerning the realization of widespread and sustainable benefits from U.S. agriculture.

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