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Title: Risk perception, attitudes towards risk and risk management: evidence and implications
Authors: Wauters, Erwin
van Winsen, Frankwin
DE MEY, Yann 
Lauwers, Ludwig
Issue Date: 2014
Abstract: The comprehensive risk analysis of a business such as farming entails questions on what is at stake, how important is the risk concern and how to deal with it. We performed a sequential mixed method, with the in-depth interviews in the first stage (n = 35), followed by a survey on the Flemish FADN (n = 614) in the second, to investigate the farmers' risk perception, the attitudes towards risk and the perceived usefulness of the risk management strategies. We find that, rather than the short-term volatility in prices, the longer term co-evolution of expenses versus receipts is of a major concern to farmers, next to the land availability and the policy risks. Farmers are shown to be only slightly risk averse, rather risk neutral even. Further, our results suggest that farmers do not consider extensively studied risk management strategies such as contracts, futures and insurances, a valid option for their farm, and put more faith in internal strategies such as the debt management, the liquidity management and diversification. Last, risk management is to a substantial degree performed at the household level, rather than at the farm level, with strategies such as cutting the private expenses and the off-farm employment. These results hardly differ according to the farm and farmer characteristics.
Notes: [Wauters, Erwin; van Winsen, Frankwin; Lauwers, Ludwig] Inst Agr & Fisheries Res ILVO, Social Sci Unit, B-9820 Merelbeke, Belgium. [Wauters, Erwin] Univ Antwerp, Dept Vet Sci, B-2020 Antwerp, Belgium. [de Mey, Yann] Hasselt Univ, Ctr Environm Sci, Diepenbeek, Belgium. [van Winsen, Frankwin; Lauwers, Ludwig] Univ Ghent, Dept Agr Econ, Fac Biosci Engn, B-9000 Ghent, Belgium.
Keywords: FADN; mixed method; perceptions; risk; risk attitudes; risk management;FADN; mixed method; perceptions; risk; risk attitudes; risk management
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ISSN: 0139-570X
e-ISSN: 1805-9295
ISI #: 000345187900001
Category: A1
Type: Journal Contribution
Validations: ecoom 2015
Appears in Collections:Research publications

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