Browse > Article
http://dx.doi.org/10.5762/KAIS.2015.16.2.1036

Measuring the Relative Risk Aversion Coefficients of Apple Farmers  

Lin, Qing-Long (Agricultural-Forestry Economics and Management, Yanbian University)
Yeo, Jun-Ho (Department of Agricultural Economics, Kyungpook National University)
Kim, Tae-Kyun (Department of Agricultural Economics, Kyungpook National University)
Publication Information
Journal of the Korea Academia-Industrial cooperation Society / v.16, no.2, 2015 , pp. 1036-1044 More about this Journal
Abstract
This paper estimates the relative risk aversion coefficients of apple farmers. Two hypothetical situations are designed and two-stage questionnaires are conducted for each situation. A utility function that has constant relative risk aversion was used, and it was assumed that the relative risk aversion coefficients follow a log-normal distribution. To reduce the hypothetical bias, the data was collected from repetitive questions. As a result, the mean and standard deviation of the relative risk aversion coefficients of apple farmers was 10.915 and 7.516, respectively. The relative risk aversion coefficients conditional on a survey response in each category were also measured. These findings can be used as parameters to analyze the effects of risk management tools.
Keywords
Apple Farmer; Constant Relative Risk Aversion; Ordered Probit with Known Bounds; Relative Risk Aversion Coefficient;
Citations & Related Records
연도 인용수 순위
  • Reference
1 S.H. Kim, "Risk Efficient Farm plans for Garlic and Onion Growers in Chonnam Province", Korean Journal of Agricultural Economics, 40(1), 199-219, 1999.
2 J.M. Antle, "Econometric Estimation of Producers' Risk Attitudes", American Journal of Agricultural Economics, 69, 509-522, 1987. DOI: http://dx.doi.org/10.2307/1241687   DOI
3 H.A. Love, S.T. Buccola, "Joint Risk Preference-Technology Estimation with a Primal System", American Journal of Agricultural Economics, 73, 765-774, 1991. DOI: http://dx.doi.org/10.2307/1242829   DOI
4 A. Saha, C.R. Shumway, H. Talpaz, "Joint Estimation of Risk Preference Structure and Technology Using Expo-Power Utility", American Journal of Agricultural Economics, 76, 173-184, 1994. DOI: http://dx.doi.org/10.2307/1243619   DOI
5 J.P. Chavas, M.T. Holt, "Economic Behavior Under Uncertainty: A Joint Analysis of Risk Preferences and Technology", Review of Economics and Statistics, 78, 329-335, 1996. DOI: http://dx.doi.org/10.2307/2109935   DOI
6 S.C. Kumbhakar, "Risk Preference and Technology", Marine Resource Economics, 73, 73-76, 2002.
7 M. Isik, M. Khanna, "Stochastic Technology, Risk Preferences, and Adoption of Site-specific Technologies", American Journal of Agricultural Economics, 85, 305-317, 2003. DOI: http://dx.doi.org/10.1111/1467-8276.00121   DOI
8 P. Sckokai, D. Moro, "Modeling the Reforms of the Common Agricultural Policy for Arable Crops under Uncertainty", American Journal of Agricultural Economics, 88, 43-56, 2006. DOI: http://dx.doi.org/10.1111/j.1467-8276.2006.00857.x   DOI
9 J.L. Dillon, P.L. Scandizzo, "Risk Attitudes of Subsistence Farmers in Northeast Brazil: a Sampling Approach", American Journal of Agricultural Economics, 60, 425-435, 1978. DOI: http://dx.doi.org/10.2307/1239939   DOI
10 G. Bond, B. Wonder, "Risk Attitudes Amongst Australian Farmers", Australian Journal of Agricultural Economics, 24, 16-34, 1980. DOI: http://dx.doi.org/10.1111/j.1467-8489.1980.tb00367.x   DOI
11 H.P. Binswanger, "Attitudes toward Risk: Experimental Measurement In Rural India", American Journal of Agricultural Economics, 62, 395-407, 1980. DOI: http://dx.doi.org/10.2307/1240194   DOI
12 B.A. Babcock, E.K. Choi, E. Feinerman, "Risk and Probability Premiums for CARA Utility Functions", Journal of Agricultural and Resource Economics, 18, 17-24, 1993.
13 O.S. Kwon, "Joint Estimation of Risk Preference Structure and Technology in Korean Rice Farming", Korean Journal of Agricultural Economics, 43(2), 77-91, 2002.
14 S.Y. Yang, J.Y. Moon, "The Welfare Effects of Commodity Price Risk Management Using Futures Markets in Korea", Korean Journal of Agricultural Economics, 40(2), 57-83, 1999.
15 G.Y. Sa, M.H. Kim, "The impacts of rice purchase system on rural household", 2001 Summer Symposium on the Korean Agricultural Economics Association, 277-301, 2001.
16 B.I. An, J.H. Kim, "An Analysis of Risk-averse Attitudes of Vegetables Farmers in Korea", Rural Economy, 25(3), 19-35, 2002.
17 M.B. Stewart, "On Least Squares Estimation When the Dependent Variable is Grouped", Review of Economic Studies, 50, 737-753, 1983. DOI: http://dx.doi.org/10.2307/2297773   DOI
18 H.S. Ji, T.K. Kim, "Measuring Risk Attitudes of Apple Producers", Korean Journal of Agricultural Economics, 51( 2), 89-107, 2010.
19 M.S. Kimball, C.R. Sahm, M.D. Shapiro, "Imputing Risk Tolerance Form Survey Responses", J. Am. Stat. Assoc., 103, 1028-1038, 2008. DOI: http://dx.doi.org/10.1198/016214508000000139   DOI
20 J.W. Pratt, "Risk Aversion in the Small and in the Large", Econometrica, 122-136, 1964. DOI: http://dx.doi.org/10.2307/1913738   DOI
21 S. Stern, "Imputing a Continuous Income Variable for a Bracketed Income Variable with Special Attention to Missing Observations", Economics Letters, 37, 287-291, 1991. DOI: http://dx.doi.org/10.1016/0165-1765(91)90224-9   DOI
22 H. Martin, J.G. Eisenhauer, "Demography of Risk Aversion", The Journal of Risk and Insurance, 68, 1-24, 2001. DOI: http://dx.doi.org/10.2307/2678130   DOI