Comparison of the investment behavior of Kazakhstani and German farmers: An experimental approach

Dulat Tubetov, Syster Christin Maart and Oliver Musshoff

No 124650, 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington from Agricultural and Applied Economics Association

Abstract: The agricultural sectors of Kazakhstan and Germany are at different development levels. One possible explanation for this might be the different investment behavior of farmers. We experimentally analyze whether the investment behavior of farmers is consistent with the normative benchmarks of the net present value criterion or the real options approach. Furthermore, we experimentally compare the investment behavior of farmers in the two countries in an agricultural and a non-agricultural treatment. In addition, farmers were confronted with the two treatments in a different order. Our results show that both theories cannot exactly predict the investment behavior of farmers. Farmers invest later than the net present value criterion suggests and earlier than the real options approach suggests. However, German farmers invest later than Kazakhstani farmers, which mean that the investment behavior of German farmers is closer to the superior real options approach. Therefore, the different investment behavior might partly be an explanation for different development levels of the agricultural sectors of the two countries. Moreover, results are independent from the framing of an agricultural and a non-agricultural treatment. However, farmers learn from their former investment decisions and consider the value of waiting over time.

Keywords: Farm; Management (search for similar items in EconPapers)
Pages: 33
Date: 2012
New Economics Papers: this item is included in nep-exp
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/124650/files/AAEA%20Seattle%20Tubetov.pdf (application/pdf)

Related works:
Working Paper: The comparison of investment behaviors of Kazakhstani and German farmers: An experimental approach (2012)
Working Paper: Comparison of the investment behavior of Kazakhstani and German farmers: An experimental approach (2012)
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:aaea12:124650

DOI: 10.22004/ag.econ.124650

Access Statistics for this paper

More papers in 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington from Agricultural and Applied Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().