Safety Net Perception and its Effects on Household Investment in Developing Countries: Chemical Fertilizer Input by Cambodian Farmers
AbstractFarmers in developing countries are reluctant to make investments for fear of failure and the economic distress resulting from this, but the perception of protection by a safety net may induce farmers to invest by reducing that fear. Using Cambodian farm household data, this paper examines factors affecting the perception of protection by a safety net and then assesses the effect of this perception on farmers' investment. For empirical analyses, perceived credit availability from relatives represents this perceived safety net; and chemical fertilizer input signifies the investment size. The results of the econometric analysis demonstrate that farm households with higher economic status, who are able to repay a loan or favour, are more likely to perceive such a safety net. It is also shown that the safety net perception positively affects chemical fertilizer input, implying that farmers accept risk when they perceive a safety net. These findings suggest that it is not only a lack of capital that deters poor households from investment, but also the perceived lack of a safety net.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal Oxford Development Studies.
Volume (Year): 37 (2009)
Issue (Month): 4 ()
Contact details of provider:
Web page: http://www.tandfonline.com/CODS20
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty).
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 references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.