IDEAS home Printed from https://ideas.repec.org/a/eee/jfpoli/v120y2023ics0306919223000751.html
   My bibliography  Save this article

Aspirations, risk preferences, and investments in agricultural technologies

Author

Listed:
  • Villacis, Alexis H.
  • Bloem, Jeffrey R.
  • Mishra, Ashok K.

Abstract

We investigate the relationship between aspirations, risk preferences, and investment in agricultural technologies using data collected among cacao farmers in Ecuador. We first find that an inverted U-shaped relationship between the income aspirations gap and investments exists when considering relatively long-term investments (e.g., farm renovations) but not when considering relatively short-term investments (e.g., fertilizer use). Next, using lab-in-the-field experiments and survey instruments designed to elicit risk preferences, we show that the observed inverted U-shaped relationship is robust to the inclusion of risk preference parameters in our regression specification—a potentially important omitted variable in previous studies. Our empirical results are consistent with existing theory suggesting that aspirations that are ahead, but not too far ahead, of current levels provide the best incentives for investments in the future, and suggest the presence of psychological constraints to investments in agricultural technology.

Suggested Citation

  • Villacis, Alexis H. & Bloem, Jeffrey R. & Mishra, Ashok K., 2023. "Aspirations, risk preferences, and investments in agricultural technologies," Food Policy, Elsevier, vol. 120(C).
    • Handle: RePEc:eee:jfpoli:v:120:y:2023:i:c:s0306919223000751
    DOI: 10.1016/j.foodpol.2023.102477
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0306919223000751
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.foodpol.2023.102477?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Aspirations; Risk; Investment; Agriculture; Cacao;
    All these keywords.

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q16 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - R&D; Agricultural Technology; Biofuels; Agricultural Extension Services

    Statistics

    Access and download statistics

    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:eee:jfpoli:v:120:y:2023:i:c:s0306919223000751. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/foodpol .

    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.