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Research article2024Peer reviewedOpen access

A note on European farmers' preferences under cumulative prospect theory

Finger, Robert; Garcia, Viviana; Mccallum, Chloe; Rommel, Jens


Explaining farmer decision making using cumulative prospect theory is of increasing importance. We present a systematic review on European farmers' preferences under the cumulative prospect theory framework. We identified 17 studies covering 2324 farmers from 12 European countries. All studies report that (on average) farmers are: (i) risk averse, (ii) loss averse, and (iii) overweight small probabilities and underweight large probabilities. However, there is a large heterogeneity across and within studies. These findings have implications for the analysis and design of policy and insurance.


farmer; preferences; prospect theory; risk and uncertainty; risk management

Published in

Journal of Agricultural Economics
2024, Volume: 75, number: 1, pages: 465-472
Publisher: WILEY

    Associated SLU-program


    Sustainable Development Goals

    Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss
    End hunger, achieve food security and improved nutrition and promote sustainable agriculture

    UKÄ Subject classification

    Business Administration

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