This article applies frontier production function analysis to small farms in Nicaragua during 1998-2005 (Battese and Coelli, 1988). The objective of this study is to estimate an average function that will provide a picture of the shape of the organic fertilizer technology of an average firm (in...

Published by Asociación de Economistas Agrarios de Chile

Limited budget for the purchase of variable inputs might adversely affect producer's input use decisions and might result in a non-optimal input usage. If expenditure constrains are present and binding, unconstrained profit-maximization is not valid for modelling producers' input use decisions....

By using a stochastic frontier framework, the mutual effect of input use on production risk and inefficiency is investigated. Disentangling this mutual effect proves important for empirical reasons, at least when applied to west Tennessee cotton systems grown after various cover crops. The most...

Cattle feeding enterprises operate amid variability originating in prices and production. This research explicitly models yield risks related to cattle feeding by relating the mean and variance of yield performance factors to observable conditioning variables. The results demonstrate that pen...

Do transgenic crops cause agrobiodiversity erosion? We hypothesize that they increase productivity and reduce production risk and may therefore reduce farmer demand for on-farm varietal diversity, especially when only a few transgenic varieties are available. We also hypothesize that varietal...

In this paper we specify and estimate producers’ risk preference using farm data. We allow heterogeneous risk preference across individuals and propose a specification to model the heterogeneity. We base farmers’ decision making on a utility maximization framework and incorporate both market...

Past agricultural input market participation studies have generally ignored the joint influence of income diversification, transaction cost and production risk on input market participation decisions. This study develops an analytical framework that jointly incorporates the three factors and...

Many of the poor in the developing world rely on agriculture for their livelihood. Unfortunately, agricultural production is inherently risky, which puts these farmers at risk of not being able to meet even their basic subsistence needs. Therefore, understanding these farmers’ attitudes...

The paper investigates the linkages between technological change and production risk, with an application to corn. The effects of technology on risk exposure are analyzed. We define technological progress to be risk-increasing (risk-decreasing) if it increases (decreases) the relative risk...