Pannell, David J.; Hailu, Getu; Weersink, Alfons; Burt, … - 2007
The use by farmers of futures contracts and other hedging instruments has been observed to be low in many situations … understandable and consistent with rational decision making. Standard models of the decision about optimal hedging show that it is … a lower optimal level of hedging. If a farmer has optimistic price expectations relative to the futures market, the …