Acreage Response under Varying Risk Preferences

Carlos Arnade and Joseph Cooper ()

Journal of Agricultural and Resource Economics, 2012, vol. 37, issue 3, 17

Abstract: The assumption in standard expected utility model formulations that the coefficient of risk aversion is a constant is potentially unrealistic. This study takes the standard linear expected meanvariance problem and replaces the coefficient of risk aversion with a function of risk aversion, allowing risk to be depicted as a constraint that farmers face. Treating output prices as stochastic, the theoretical formulation measures the impact price variability itself has on risk preferences. Acreage response elasticities are also estimated as a function of prices and price variances using U.S. county-level data for corn, soybean, and wheat producers.

Keywords: Demand and Price Analysis; Land Economics/Use; Risk and Uncertainty (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://ageconsearch.umn.edu/record/142352/files/J ... pp398-414_Cooper.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:jlaare:142352

DOI: 10.22004/ag.econ.142352

Access Statistics for this article

More articles in Journal of Agricultural and Resource Economics from Western Agricultural Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().