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Impact of Risk on HYV Adoption in Bangladesh

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  • Ashok Parikh
  • Andrew Bernard

Abstract

The objectives of this paper are to develop a measure of risk aversion based on the safety‐first principle. The risk coefficient for a large number of farmers was positive indicating the tendency towards gambling in Bangladesh agriculture. Farmers who were near subsistence income (disaster level of income) tended to choose riskier crops such as HYV rice. The risk‐aversion variable was highly correlated with demographic and socioeconomic variables. Large holders of land tended to be relatively more risk‐averse than small holders of land and area allocated to HYV proportionally declined with increases in holding size. A three‐equation model on HYV adoption decisions, fertilizer and hired labour was estimated with a risk‐aversion variable based on the safety‐first principle, and expected and significant signs were obtained with the risk‐aversion variable in HYV and hired labour equations.

Suggested Citation

  • Ashok Parikh & Andrew Bernard, 1988. "Impact of Risk on HYV Adoption in Bangladesh," Agricultural Economics, International Association of Agricultural Economists, vol. 2(2), pages 167-178, October.
    • Handle: RePEc:bla:agecon:v:2:y:1988:i:2:p:167-178
    DOI: 10.1111/j.1574-0862.1988.tb00046.x
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    Cited by:

    1. Sookhtanlo, Mojtaba & Sarani, Valiollah, 2011. "Analysis of Factors Affecting on Risk Management of Wheat Production Among Wheat Farmers (Razavieh Region, Khorasan-E-Razavi Province, Iran)," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 3(4), pages 1-9, December.
    2. Khondoker A. Mottaleb & Samarendu Mohanty & Andrew Nelson, 2015. "Factors influencing hybrid rice adoption: a Bangladesh case," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 59(2), pages 258-274, April.
    3. Fufa, B. & Hassan, Rashid M., 2006. "Determinants of fertilizer use on maize in Eastern Ethiopia: A weighted endogenous sampling analysis of the extent and intensity of adoption," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 45(1), pages 1-12, March.

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