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Income risk and farm consumption behavior

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  • Chen, Kevin Z.
  • Meilke, Karl D.
  • Turvey, Calum
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    Abstract

    Using panel data from Illinois grain farmers, a direct test of the relationship between income risk and farm consumption behavior is conducted. The estimation results indicate that income risk significantly affects farm consumption and the results are robust using alternative risk measures. This finding casts doubt on the relevance of the conventional life-cycle permanent income hypothesis, which implies that risk has no effect on consumption. © 1999 Elsevier Science B.V. All rights reserved.

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    Bibliographic Info

    Article provided by International Association of Agricultural Economists in its journal Agricultural Economics of Agricultural Economists.

    Volume (Year): 20 (1999)
    Issue (Month): 2 (March)
    Pages:

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    Handle: RePEc:ags:iaaeaj:174965

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    Web page: http://www.iaae-agecon.org/
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    Keywords: Income risk; Farm consumption; Labor and Human Capital; Production Economics;

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    Cited by:
    1. Jin, Ling & Chen, Kevin Z. & Yu, Bingxin & Huang, Zuhui, 2011. "How prudent are rural households in developing transition economies:," IFPRI discussion papers 1127, International Food Policy Research Institute (IFPRI).

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