Economies of diversification and stochastic dominance analysis in French mixed sheep farms

Jean-Joseph Minviel () and Marc Benoit ()
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Jean-Joseph Minviel: UMRH - Unité Mixte de Recherche sur les Herbivores - UMR 1213 - VAS - VetAgro Sup - Institut national d'enseignement supérieur et de recherche en alimentation, santé animale, sciences agronomiques et de l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement
Marc Benoit: UMRH - Unité Mixte de Recherche sur les Herbivores - UMR 1213 - VAS - VetAgro Sup - Institut national d'enseignement supérieur et de recherche en alimentation, santé animale, sciences agronomiques et de l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement

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Abstract: Abstract Farm diversification is mainly driven by risk mitigation effects and economic gains related to complementarities between production activities. By combining these two aspects, we investigate diversification economies in a sample of French mixed sheep farming systems and rank these systems using stochastic dominance criteria. Partially diversified systems (Sheep-Grass, Sheep-Crop, Sheep-Landless) and fully diversified systems (Sheep-Grass-Crop-Landless) were evaluated. We find a high degree of diversification diseconomies in the sheep farming systems considered. The results also indicate that the fully diversified system is driven by its risk-reducing effects (including downside risk exposure) and that Sheep-Crop is the dominant system in terms of risk-adjusted returns.

Keywords: downside risk exposure; economic resilience; economies of diversification; Massif Central; mixed sheep farms; SERF analysis; stochastic dominance (search for similar items in EconPapers)
Date: 2022-01-10
New Economics Papers: this item is included in nep-agr and nep-cwa
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Published in Agricultural and Resource Economics Review, 2022, pp.1-22. ⟨10.1017/age.2021.26⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03522983

DOI: 10.1017/age.2021.26

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