A healthy financial system encourages the efficient allocation of capital and risk. The collapse of the house price bubble led to the financial crisis that started in 2007. There is a large empirical literature concerning the relation between asset price bubbles and financial crises. I evaluate...

The standard model of inter-temporal optimization is based upon certainty equivalence and ignores risk and uncertainty. We solve a modification of the standard model of inter-temporal optimization in an environment where the return to capital is stochastic, and we impose the constraint that...

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...

Physical resources such as land, labour and livestock, and nonphysical resources such as indigenous knowledge and institutions of producers in the grain surplus and deficit regions of the Central Highlands of Ethiopia are examined under situation of environmental and policy risks. Frequency...

Risk (and often the certainty) of adverse environmental outcomes motivates environmental regulation; other risks also affect welfare outcomes. Economic instruments are one way to reduce environmental risk while maintaining flexibility that helps manage other risks. However regulation not only...

This paper incorporates the interdisciplinary New Institutional Economics in a comprehensive framework for analyzing risk management in the agri-food sector. First, it specifies the diverse types of agri-food risks (natural, technical, behavioral, economic, policy, etc.) and the modes of their...

Utilizing a data set of 399 Namibian commercial cattle farmers, we provide a detailed empirical analysis of farm management under highly variable rainfall. Particularly, we provide an econometric analysis of what personal characteristics of the farmer, environmental characteristics, and...

We provide an initial framework regarding priorities for government programs to reduce the natural-disaster vulnerability of farm households in the Philippines. We begin with the likelihood that climate change will increase the probability of flooding, since rainfall is expected to both increase...