An Operational Approach for Evaluating Investment Risk: An Application to the No-Till Transition
Mykel Taylor ()
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Mykel Taylor: School of Economic Sciences, Washington State University
No 2010-17, Working Papers from School of Economic Sciences, Washington State University
An Operational Approach for Evaluating Investment Risk: An Application to the No-Till Transition Abstract: Roy’s safety-first rule is used to provide measures popular with farmers of short and long term business risk associated with various no-till transition strategies over an investment horizon. The short run rule provided more sensitivity to inter-year financial risk than other commonly used criteria. Results revealed that speed of adoption influenced the probability of successful transition more than did the sequence of drill acquisition methods. Higher equity and larger farms had a greater chance of transition success. Slow acreage expansion with a custom or rental drill reduces risk until a no-till yield penalty is eliminated.
Keywords: food safety; discrete choice; information; consumer demand (search for similar items in EconPapers)
JEL-codes: D12 D83 Q18 (search for similar items in EconPapers)
Pages: 37 pages
New Economics Papers: this item is included in nep-agr
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http://faculty.ses.wsu.edu/WorkingPapers/MTaylor/WP2010-17.pdf First version, 2005 (application/pdf)
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Persistent link: https://EconPapers.repec.org/RePEc:wsu:wpaper:mtaylor-2
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