Supply Response under Risk: Implications for Counter-Cyclical Payments' Production Impact

William Lin and Robert Dismukes

Review of Agricultural Economics, 2007, vol. 29, issue 1, 64-86

Abstract: This study investigates the role of risk in farmers' acreage decisions for major field crops in the North Central region by revisiting an earlier study by Chavas and Holt. The empirical model is forward-looking and reflects better variable measurement. We test the effects of wealth and revenue risk on supply response. Estimated results are also used to examine the production impact of counter-cyclical payments (CCPs). We find that the effects of risk on supply response are not strong. An increase in initial wealth would lead to greater crop acreage, consistent with decreasing absolute risk aversion. The effect of CCPs on production appears to be negligible. Copyright 2007, Oxford University Press.

Date: 2007
References: Add references at CitEc
Citations: View citations in EconPapers (46)

Downloads: (external link)
http://hdl.handle.net/10.1111/j.1467-9353.2006.00330.x (application/pdf)
Access to full text is restricted to subscribers.

Related works:
Journal Article: Supply Response under Risk: Implications for Counter-Cyclical Payments' Production Impact (2007)
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:29:y:2007:i:1:p:64-86

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 ().