Farmland Control Decisions under Different Intertemporal Risk Behavioral Constructs

Cesar Escalante () and Roderick Rejesus

No 19113, 2005 Annual meeting, July 24-27, Providence, RI from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: Simulation-optimization techniques are employed to analyze changes in farmland control arrangements as a result of using different constructs of intertemporal risk behavior. Risk behavior based on constant absolute risk aversion (CARA) and constant relative risk aversion (CRRA) mean-standard deviation functions are used to achieve this objective. Specfically, a multi-period programming framework for a representative grain farm is developed to explore farmland control decisions under these two behavioral assumptions. Our results suggest that the use of a CRRA behavioral construct in analyzing farmland control decisions produce predictions that are more consistent with observed farm behavior.

Keywords: Farm; Management (search for similar items in EconPapers)
Pages: 24
Date: 2005
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea05:19113

DOI: 10.22004/ag.econ.19113

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