MAGNITUDE ESTIMATION: AN APPLICATION TO FARMERS' RISK-INCOME PREFERENCES

George F. Patrick, Brian F. Blake and Suzanne H. Whittaker

Western Journal of Agricultural Economics, 1981, vol. 06, issue 2, 10

Abstract: Magnitude estimation, a technique developed by psychology for obtaining ratio scaled values, was used to derive risk-income preferences of ninety-one central Indiana farmers. Both variability-income and bankruptcy-income measures were developed and related to farmers' socio-economic attributes. Wealth and education had limited effects compared with off-farm employment, percent debt and expected levels of income, percent debt and net worth growth. Magnitude estimation provided reliable estimates of preferences. Farmers gave greater importance to the bankruptcy-income measure of risk-income preferences, but only a small portion of the variation of either measure could be explained.

Keywords: Farm Management; Risk and Uncertainty (search for similar items in EconPapers)
Date: 1981
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:wjagec:32583

DOI: 10.22004/ag.econ.32583

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