Given the economic crisis and rising in food price in 2008, a redistribution in income between different sectors can be expected. This paper contributes to this issue by assess the impacts of the change in income inequality between farm households. In addition, we investigate the extent to which the farm, nonfarm, and government payments contributes to income inequality due to the change in macroeconomic environment in 2008. Using a decomposition method on a national household survey data in Taiwan in 2007 and 2008, results indicate farm and nonfarm income have different implications for full-time and part-time farm households. In addition, the income inequality declined significantly among full-time farm households from 2007 to 2008. Keyword: Financial crisis; income inequality, farm household, decomposition, Taiwan.
