IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v8y2016i4p338-d67690.html
   My bibliography  Save this article

Economic Sustainability of Organic Aloe Vera Farming in Greece under Risk and Uncertainty

Author

Listed:
  • Angelos Liontakis

    (Agricultural Economics Research Institute, Terma Alkmanos str. P.C. Athens 11528, Greece
    These authors contributed equally to this work.)

  • Irene Tzouramani

    (Agricultural Economics Research Institute, Terma Alkmanos str. P.C. Athens 11528, Greece
    These authors contributed equally to this work.)

Abstract

During the last decade, an encouraging environment for the restructuring and modernization of the agricultural sector has formed in Greece. The diversification into higher-value crops can be a promising option for small and average-sized farms, particularly during the current economic crisis. One of the most promising alternative crops that have been recently established in Greece is the organic Aloe vera crop. The main advantage of this crop is that it can utilize poor farmlands and, therefore, can facilitate rural development in marginal areas. This study explores the economic sustainability of the Aloe vera crop, considering the embedded risk and uncertainty. The results indicate that organic aloe farming is a promising alternative to “traditional” crops in Greece, particularly for family farms in rural areas. In contrast, this activity is not advisable to the most entrepreneurial type of farmers, unless their crop size allows economies of scales. Finally, the Stochastic Efficiency with Respect to a Function (SERF) analysis associates farmers’ risk attitude with their willingness to be involved in organic Aloe vera farming. SERF analysis highlights the crucial role of farmers’ risk aversion and concludes that, above a certain level of risk aversion, farmers have no incentive to adopt this economic activity.

Suggested Citation

  • Angelos Liontakis & Irene Tzouramani, 2016. "Economic Sustainability of Organic Aloe Vera Farming in Greece under Risk and Uncertainty," Sustainability, MDPI, vol. 8(4), pages 1-13, April.
  • Handle: RePEc:gam:jsusta:v:8:y:2016:i:4:p:338-:d:67690
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/8/4/338/pdf
    Download Restriction: no

    File URL: https://www.mdpi.com/2071-1050/8/4/338/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Arthur C. Thomas, 1987. "Risk Attitudes Measured by the Interval Approach: A Case Study of Kansas Farmers," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 69(5), pages 1101-1105.
    2. Klaas Calker & Paul Berentsen & Gerard Giesen & Ruud Huirne, 2005. "Identifying and ranking attributes that determine sustainability in Dutch dairy farming," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 22(1), pages 53-63, March.
    3. J. Brian Hardaker & James W. Richardson & Gudbrand Lien & Keith D. Schumann, 2004. "Stochastic efficiency analysis with risk aversion bounds: a simplified approach," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 48(2), pages 253-270, June.
    4. Dustin L. Pendell & Jeffery R. Williams & Scott B. Boyles & Charles W. Rice & Richard G. Nelson, 2007. "Soil Carbon Sequestration Strategies with Alternative Tillage and Nitrogen Sources under Risk," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 29(2), pages 247-268.
    5. van Calker, K. J. & Berentsen, P. B. M. & de Boer, I. M. J. & Giesen, G. W. J. & Huirne, R. B. M., 2004. "An LP-model to analyse economic and ecological sustainability on Dutch dairy farms: model presentation and application for experimental farm "de Marke"," Agricultural Systems, Elsevier, vol. 82(2), pages 139-160, November.
    6. Theodore Mitrakos, 2014. "Inequality, poverty and social welfare in Greece: distributional effects of austerity," Working Papers 174, Bank of Greece.
    7. Ryan, Mary & Buckley, Cathal & Dillon, Emma Jane & Donnellan, Trevor & Hanrahan, Kevin & Hennessy, Thia & Moran, Brian, 2014. "The development of farm-level sustainability indicators for Ireland using the Teagasc National Farm Survey," 88th Annual Conference, April 9-11, 2014, AgroParisTech, Paris, France 170501, Agricultural Economics Society.
    8. Tzouvelekas, Vangelis & Pantzios, Christos J. & Fotopoulos, Christos, 2001. "Technical efficiency of alternative farming systems: the case of Greek organic and conventional olive-growing farms," Food Policy, Elsevier, vol. 26(6), pages 549-569, December.
    9. Thomas, Arthur C., 1987. "Risk Attitudes Measured by the Interval Approach: A Case Study of Kansas Farmers," SS-AAEA Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 5(1), December.
    10. Parakrama Weligamage & C. Richard Shumway & Keith A. Blatner, 2014. "Water access, farm productivity, and farm household income: Sri Lanka's Kirindi Oya irrigation system," Agricultural Economics, International Association of Agricultural Economists, vol. 45(5), pages 649-661, September.
    11. Eihab M. Fathelrahman & James C. Ascough II & Dana L. Hoag & Robert W. Malone & Philip Heilman & Lori J. Wiles & Ramesh S. Kanwar, 2011. "Continuum of Risk Analysis Methods to Assess Tillage System Sustainability at the Experimental Plot Level," Sustainability, MDPI, vol. 3(7), pages 1-29, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Némethová Jana & Dubcová Alena & Nagyová Ľudmila & Kramáreková Hilda, 2017. "Ecological Farming in Slovakia and Its Regional Disparities," European Countryside, Sciendo, vol. 9(4), pages 746-768, December.
    2. Pavlos Karanikolas & Dimitrios Theocharidis & Thedoros Tsiligiridis & Konstantinos Tsiboukas, 2017. "Small farms contribution to food security: a food system resilience perspective," Working Papers 2017-1, Agricultural University of Athens, Department Of Agricultural Economics.
    3. Juan Torres & Diego L. Valera & Luis J. Belmonte & Carlos Herrero-Sánchez, 2016. "Economic and Social Sustainability through Organic Agriculture: Study of the Restructuring of the Citrus Sector in the “ Bajo Andarax ” District (Spain)," Sustainability, MDPI, vol. 8(9), pages 1-14, September.
    4. Angelos Liontakis & Irene Tzouramani & Stamatis Mantziaris & Alexandra Sintori, 2020. "Unravelling the Role of Gender in Fisheries’ Socio-Economic Performance: The Case of Greek Small-Scale Fisheries," Sustainability, MDPI, vol. 12(13), pages 1-13, June.
    5. Angelos Liontakis & Alexandra Sintori & Irene Tzouramani, 2021. "The Role of the Start-Up Aid for Young Farmers in the Adoption of Innovative Agricultural Activities: The Case of Aloe Vera," Agriculture, MDPI, vol. 11(4), pages 1-24, April.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Angelos Liontakis & Irene Tzouramani & Stamatis Mantziaris & Alexandra Sintori, 2020. "Unravelling the Role of Gender in Fisheries’ Socio-Economic Performance: The Case of Greek Small-Scale Fisheries," Sustainability, MDPI, vol. 12(13), pages 1-13, June.
    2. Eihab M. Fathelrahman & James C. Ascough II & Dana L. Hoag & Robert W. Malone & Philip Heilman & Lori J. Wiles & Ramesh S. Kanwar, 2011. "Continuum of Risk Analysis Methods to Assess Tillage System Sustainability at the Experimental Plot Level," Sustainability, MDPI, vol. 3(7), pages 1-29, July.
    3. Adusumilli, Naveen & Wang, Hua & Dodla, Syam & Deliberto, Michael, 2020. "Estimating risk premiums for adopting no-till and cover crops management practices in soybean production system using stochastic efficiency approach," Agricultural Systems, Elsevier, vol. 178(C).
    4. Angelos Liontakis & Alexandra Sintori & Irene Tzouramani, 2021. "The Role of the Start-Up Aid for Young Farmers in the Adoption of Innovative Agricultural Activities: The Case of Aloe Vera," Agriculture, MDPI, vol. 11(4), pages 1-24, April.
    5. Lyman, Nathaniel & Nalley, Lawton Lanier, 2013. "Stochastic Valuation of Hybrid Rice Technology in Arkansas," 2013 Annual Meeting, February 2-5, 2013, Orlando, Florida 142505, Southern Agricultural Economics Association.
    6. Lombard, J. P. & Kassier, W. E., 1990. "Implementering Van Die Intervalbenadering By Die Bepaling Van Besluitnemers Se Houding Teenoor Risiko," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 29(4), December.
    7. Eihab Fathelrahman & Aydin Basarir & Mohamed Gheblawi & Sherin Sherif & James Ascough, 2014. "Economic Risk and Efficiency Assessment of Fisheries in Abu-Dhabi, United Arab Emirates (UAE): A Stochastic Approach," Sustainability, MDPI, vol. 6(6), pages 1-21, June.
    8. van Calker, K.J. & Berentsen, P.B.M. & de Boer, I.J.M. & Giesen, G.W.J. & Huirne, R.B.M., 2007. "Modelling worker physical health and societal sustainability at farm level: An application to conventional and organic dairy farming," Agricultural Systems, Elsevier, vol. 94(2), pages 205-219, May.
    9. Williams, Jeffery R. & Llewelyn, Richard V. & Pendell, Dustin L. & Schlegel, Alan J. & Troy, Dumler, 2009. "A Risk Analysis of Converting CRP Acres to a Wheat-Sorghum-Fallow Rotation," 2009 Annual Meeting, January 31-February 3, 2009, Atlanta, Georgia 45985, Southern Agricultural Economics Association.
    10. Williams, J. R. & DeLano, D. R. & Heiniger, R. W. & Vanderlip, R. L. & Llewelyn, R. V., 1999. "Replanting strategies for grain sorghum under risk," Agricultural Systems, Elsevier, vol. 60(2), pages 137-155, May.
    11. Ahearn, Mary Clare & Collender, Robert N. & Diao, Xinshen & Harrington, David H. & Hoppe, Robert A. & Korb, Penelope J. & Makki, Shiva S. & Morehart, Mitchell J. & Roberts, Michael J. & Roe, Terry L. , 2004. "Decoupled Payments In A Changing Policy Setting," Agricultural Economic Reports 33981, United States Department of Agriculture, Economic Research Service.
    12. van Calker, K.J. & Berentsen, P.B.M. & Giesen, G.W.J. & Huirne, R.B.M., 2008. "Maximising sustainability of Dutch dairy farming systems for different stakeholders: A modelling approach," Ecological Economics, Elsevier, vol. 65(2), pages 407-419, April.
    13. Gandorfer, Markus & Pannell, David & Meyer-Aurich, Andreas, 2011. "Analyzing the effects of risk and uncertainty on optimal tillage and nitrogen fertilizer intensity for field crops in Germany," Agricultural Systems, Elsevier, vol. 104(8), pages 615-622, October.
    14. Luhmann, Henrike & Schaper, Christian & Theuvsen, Ludwig, 2016. "Acceptance of a Sustainability Standard: Evidence from an Empirical Study of Future-Oriented Dairy Farmers," 2016 International European Forum (151st EAAE Seminar), February 15-19, 2016, Innsbruck-Igls, Austria 244538, International European Forum on System Dynamics and Innovation in Food Networks.
    15. Gerdessen, Johanna C. & Pascucci, Stefano, 2013. "Data Envelopment Analysis of sustainability indicators of European agricultural systems at regional level," Agricultural Systems, Elsevier, vol. 118(C), pages 78-90.
    16. Toland, Gerald D. Jr. & Schmiesing, Brain H. & Black, J. Roy, 1990. "A Comparison of Crop Yield Coverage Plans for Multiple Peril Crop Insurance," 1990 Annual meeting, August 5-8, Vancouver, Canada 271049, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    17. Fausti, Scott W. & Gillespie, Jeffrey M., 2006. "Measuring risk attitude of agricultural producers using a mail survey: how consistent are the methods?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 50(2), pages 1-18, June.
    18. Schurle, Bryan W. & Tierney, William I., Jr., 1990. "A Comparison of Risk Preference Measurements with Implications for Extension Programming," Staff Papers 118185, Kansas State University, Department of Agricultural Economics.
    19. Watkins, K. Bradley & Hignight, Jeffrey A. & Anders, Merle M., 2009. "Assessing the Impacts of Soil Carbon Credits and Risk on No-Till Rice Profitability," 2009 Annual Meeting, January 31-February 3, 2009, Atlanta, Georgia 45806, Southern Agricultural Economics Association.
    20. Williams, Jeffery R. & Pachta, Matthew J. & Roozeboom, Kraig L. & Llewelyn, Richard V. & Claassen, Mark M. & Bergtold, Jason S., 2012. "Risk Analysis of Tillage and Crop Rotation Alternatives with Winter Wheat," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 44(4), pages 1-16, November.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:8:y:2016:i:4:p:338-:d:67690. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.