Attitude towards Risk and Production Decision: An Empirical analysis on French private forest owners

Eric Kere, Jérôme Foncel and Marielle Brunette ()

No 201410, Working Papers from CERDI

Abstract: This paper deals with the forest owner’s attitude towards risk and the harvesting decision in several ways. First, we propose to characterize and quantify the forest owner’s attitude towards risk. Second, we analyze the determinants of the forest owner’s risk attitude. Finally, we determine the impact of the forest owner’s risk attitude on the harvesting decision. The French forest owner’s risk attitude is tackled by implementing a questionnaire, including a context-free measure borrowed from experimental economics. The determinants of the forest owner’s risk attitude and harvesting decision are estimated through a recursive bivariate ordered probit model. We show that French forest owners are characterized by a relative risk aversion coefficient close to 1. In addition, we found that the forest owner’s risk aversion is influenced positively and significantly by gender (female), age, and willingness to protect the environment, while the percentage of forest income in the total patrimony of the forest owner has a negative effect. Finally, we obtain that the forest owner’s risk aversion positively and significantly impacts the harvesting decision.

Keywords: Forest owner’s risk attitude; Risk aversion; Harvesting decision. (search for similar items in EconPapers)
JEL-codes: C35 D81 Q23 (search for similar items in EconPapers)
Pages: 18
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Related works:
Working Paper: Attitude Towards Risk and Production Decision: an Empirical Analysis on French Private Forest Owners (2017)
Working Paper: Attitude towards Risk and Production Decision: An Empirical analysis on French private forest owners (2015)
Working Paper: Attitude towards Risk and Production Decision: An Empirical analysis on French private forest owners (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:cdi:wpaper:1556

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