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Risk Attitudes and Farm/Producer Attributes: A Case Study of Texas Coastal Bend Grain Sorghum Producers

Published online by Cambridge University Press:  05 September 2016

S. Sri Ramaratnam ,
M. Edward Rister ,
David A. Bessler  and
James Novak
S. Sri Ramaratnam
Affiliation:
Department of Agricultural Economics, Virginia Polytechnic Institute and State University
M. Edward Rister
Affiliation:
Texas Agricultural Experiment Station and the Department of Agricultural Economics, Texas A & M University
David A. Bessler
Affiliation:
Texas Agricultural Experiment Station and the Department of Agricultural Economics, Texas A & M University
James Novak
Affiliation:
Alabama Cooperative Extension Service, Auburn University
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Abstract

An analysis of risk attitudes for a sample of grain sorghum producers in the Texas Coastal Bend is reported. Four alternative functional forms were estimated on data elicited by the direct elicitation of utility approach. The exponential functional form described most producers' utility preferences better than other utility forms. Relationships between exponential risk measures and both producer attributes and farm characteristics, including interactions among them, were identified as significant. Risk aversion was found to diminish with more experience in farming and to increase with more leasing of farm land. Risk aversion was also found to decline with larger farm size and to increase with higher dependency of farm operators on farm income.

Keywords

direct elicitationBernoullian utilityrisk aversiongrain sorghum
Type
Submitted Articles
Information
Journal of Agricultural and Applied Economics , Volume 18 , Issue 2 , December 1986 , pp. 85 - 96
Copyright
Copyright © Southern Agricultural Economics Association 1986

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