Do Farmers Really Plant Apples for Their Income and Cherries for Their Retirement? The Effects of Risk, Scope and Scale on Orchard Land Allocation

Xin Zhao, Michael P. Brady and Peter Tozer

No 205663, 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California from Agricultural and Applied Economics Association

Abstract: Most fruit growers in Central Washington that produce apples or cherries typically grow both. This is interesting given that important sources of complementarities which generate economies of scope, such as crop rotations, that motivate crop diversification throughout agriculture are not present. An alternative explanation is risk mitigation because apple and cherry yields and prices are somewhat uncorrelated. In this paper we attempt to evaluate the relative importance of economies of scope versus risk in motivating orchard crop diversification while accounting for economies of scale. To date, the literature on perennial crop supply response has not considered diversification and thus may be missing an important factor that determines farm level land allocation decisions which influence aggregate supply response.

Keywords: Crop Production/Industries; Farm Management; Land Economics/Use; Risk and Uncertainty (search for similar items in EconPapers)
Pages: 22
Date: 2015
New Economics Papers: this item is included in nep-agr
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/205663/files/AAEA_OrchardDiversification.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea15:205663

DOI: 10.22004/ag.econ.205663

Access Statistics for this paper

More papers in 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California from Agricultural and Applied Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().