Farmers’ Risk Preferences in Rural China: Measurements and Determinants

Jianjun Jin, Rui He, Haozhou Gong, Xia Xu and Chunyang He
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Jianjun Jin: State Key Laboratory of Earth Surface Processes and Resource Ecology, Beijing Normal University, Beijing 100875, China
Rui He: Faculty of Geographical Sciences, Beijing Normal University, Beijing 100875, China
Haozhou Gong: Faculty of Geographical Sciences, Beijing Normal University, Beijing 100875, China
Xia Xu: State Key Laboratory of Earth Surface Processes and Resource Ecology, Beijing Normal University, Beijing 100875, China
Chunyang He: State Key Laboratory of Earth Surface Processes and Resource Ecology, Beijing Normal University, Beijing 100875, China

IJERPH, 2017, vol. 14, issue 7, 1-11

Abstract: This study measures farmers’ risk attitudes in rural China using a survey instrument and a complementary experiment conducted in the field with the same sample of subjects. Using a question asking people about their willingness to take risks “in general”, we found that the average response of our sample is slightly risk averse. Farmers’ exogenous factors (age, gender, and height) and self-reported happiness have a significant impact on farmers’ willingness to take risks. The experiment results show that approximately 44% of farmers in the study area are risk averse. We compare farmers’ self-reported measures of risk preferences derived from the survey instrument to preferences elicited through the experimental task. Results show that answers to the general risk attitude question in the survey can predict farmers’ behaviors in the experiment to a statistically significant degree. This paper can contribute to the empirical literature on comparing local farmers’ risk attitudes across different risk preference measurement methods in the developing world.

Keywords: risk preference; farmer; survey question; risk experiment; China (search for similar items in EconPapers)
JEL-codes: I I1 I3 Q Q5 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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