Abstract

A behavioral framework and psychometric theory were used to develop a domain-specific scale to measure farmers' preferences (attitudes) for risk, when the expected benefits and perceived risks of each domain were explicitly modeled. Exploratory factor analyses based on a sample of 237 Swedish farmers highlighted three risk domains, which we termed 'Up-to-date and in deliberate control of production,' 'Carefulness and planning in general' and 'Progressive farming.' The results suggested that farmers are risk-averse in all domains. External validation of the domain-specific measurement scale suggested that it could significantly predict the observed five-year volatility in farm income. The suggested domain-specific measurement scale is of practical importance for the farmers themselves, the agribusiness, and for policy-makers.

Keywords

agriculture; behavior; psychometrics; risk preferences; Sweden

Published in

Journal of Risk Research
2012, Volume: 15, number: 7, pages: 737-753
Publisher: ROUTLEDGE JOURNALS, TAYLOR & FRANCIS LTD

SLU Authors

• Hansson, Helena

  • Department of Economics, Swedish University of Agricultural Sciences
    

• Lagerkvist, Carl-Johan

  • Department of Economics, Swedish University of Agricultural Sciences
    

UKÄ Subject classification

Economics and Business
Social Sciences
Agricultural Science


Publication identifier

DOI: https://doi.org/10.1080/13669877.2012.657217

Permanent link to this page (URI)

https://res.slu.se/id/publ/45238