Flat Earth Economics: The Far-reaching Consequences of Flat Payoff Functions in Economic Decision Making

David Pannell

Review of Agricultural Economics, 2006, vol. 28, issue 4, 553-566

Abstract: Economists tend to emphasize the optimum, but in many cases, even large deviations from optimal decisions make little difference to the payoff. This has far-reaching implications that are under-recognized, including: (a) decision makers often have a wide margin for error in their production planning decisions, and flexibility to pursue factors not considered in the calculation of payoffs; (b) optimizing techniques are sometimes of limited practical relevance for decision support; (c) the value of information used to refine management decisions is often low; and (d) the benefits of using “precision farming” technologies to adjust production input levels are often low. Copyright 2006, Oxford University Press.

Date: 2006
References: Add references at CitEc
Citations: View citations in EconPapers (78)

Downloads: (external link)
http://hdl.handle.net/10.1111/j.1467-9353.2006.00322.x (application/pdf)
Access to full text is restricted to subscribers.

Related works:
Journal Article: Flat Earth Economics: The Far-reaching Consequences of Flat Payoff Functions in Economic Decision Making (2006)
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:oup:revage:v:28:y:2006:i:4:p:553-566

Ordering information: This journal article can be ordered from
https://academic.oup.com/journals

Access Statistics for this article

More articles in Review of Agricultural Economics from Agricultural and Applied Economics Association Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK. Contact information at EDIRC.
Bibliographic data for series maintained by Oxford University Press ( this e-mail address is bad, please contact ) and Christopher F. Baum ().