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Abstract

Farmer bankruptcies often are viewed as an important measure of rural economic well-being and of the success or failure of various Federal agricultural and rural policies. But the level of farmer bankruptcies is not a good indicator of rural financial health. Bankruptcies are only a subset of all farm business exits and a lagging indicator of economic stress. They do not reflect overall economic conditions in most rural areas because farming is a relatively small part of rural economic activity.

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