The adoption of innovative cropping systems under price and production risks: a dynamic model of crop rotation choice

Aude Ridier, Karim Chaib and Caroline Roussy

No 207985, Working Papers from Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2)

Abstract: We investigate the role played by both production and market risks on farmers’ decision to adopt long rotations considered as innovative cropping systems. We build a multi-period dynamic farm model which arbitrates each year between conventional and innovative rotations. With discrete stochastic programming, the production risk is accounted for as an intra-year risk, yearly farming operations being declined according to a decision tree where probabilities are assigned. The simulations for a sample of 13 farmers who are currently experimenting this innovation in south-western France, show that substantive sunk costs act as incentives to remain in the long rotation when the farmer is supported for his engagement. They also show that both a high risk aversion and a highly positive market trend tend to slow down the conversion towards innovative systems.

Keywords: Agricultural and Food Policy; Risk and Uncertainty (search for similar items in EconPapers)
Pages: 26
Date: 2012
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Citations: View citations in EconPapers (2)

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Related works:
Working Paper: The adoption of innovative cropping systems under price and production risks: a dynamic model of crop rotation choice (2012)
Working Paper: The adoption of innovative cropping systems under price and production risks: a dynamic model of crop rotation choice (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:inrasl:207985

DOI: 10.22004/ag.econ.207985

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