IDEAS home Printed from https://ideas.repec.org/a/ags/auagre/126084.html
   My bibliography  Save this article

Rationalising Risk Assessment: Applications to Agricultural Business

Author

Listed:
  • Hardaker, J. Brian
  • Lien, Gudbrand D.

Abstract

To concentrate on treating the most serious risks, methods of business risk management usually seek to identify the main risks and to assess their relative importance. Risks are typically assessed in terms of their chances of occurrence and the severity of their consequences. The assessments may be performed by qualitative, semi-quantitative or quantitative analysis. This paper is focussed on quantitative methods, requiring assessments of specific probabilities and values for consequences.

Suggested Citation

  • Hardaker, J. Brian & Lien, Gudbrand D., 2007. "Rationalising Risk Assessment: Applications to Agricultural Business," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 15.
    • Handle: RePEc:ags:auagre:126084
    DOI: 10.22004/ag.econ.126084
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/126084/files/Hardaker_Lien.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.126084?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
    ---><---

    References listed on IDEAS

    as
    1. Richardson, James W. & Klose, Steven L. & Gray, Allan W., 2000. "An Applied Procedure For Estimating And Simulating Multivariate Empirical (Mve) Probability Distributions In Farm-Level Risk Assessment And Policy Analysis," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 32(2), pages 1-17, August.
    2. Lien, Gudbrand & Brian Hardaker, J. & Flaten, Ola, 2007. "Risk and economic sustainability of crop farming systems," Agricultural Systems, Elsevier, vol. 94(2), pages 541-552, May.
    3. Anderson, Jock R. & Dillon, John L. & Hardaker, Brian, 1977. "Agricultural Decision Analysis," Monographs: Applied Economics, AgEcon Search, number 288652, October.
    4. David K. Lambert & Bruce A. McCarl, 1985. "Risk Modeling Using Direct Solution of Nonlinear Approximations of the Utility Function," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 67(4), pages 846-852.
    5. Quiggin, John, 1992. "Some observations on insurance, bankruptcy and input demand," Journal of Economic Behavior & Organization, Elsevier, vol. 18(1), pages 101-110, June.
    6. Lien, Gudbrand D. & Hardaker, J. Brian & Richardson, James W., 2006. "Simulating Multivariate Distributions with Sparse Data: A Kernal Density Smoothing Procedure," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25449, International Association of Agricultural Economists.
    7. Mark Morrison & Jeff Bennett & Russell Blamey & Jordan Louviere, 2002. "Choice Modeling and Tests of Benefit Transfer," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(1), pages 161-170.
    8. G Lien & JB Hardaker, 2001. "Whole-farm planning under uncertainty: impacts of subsidy scheme and utility function on portfolio choice in Norwegian agriculture," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 28(1), pages 17-36, March.
    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. Monjardino, Marta & McBeath, T. & Brennan, Lisa E. & Llewellyn, Rick S., 2012. "Are farmers in low-rainfall cropping regions under-fertilizing? An Australian case-study," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 124976, International Association of Agricultural Economists.
    2. Monjardino, M. & McBeath, T. & Ouzman, J. & Llewellyn, R. & Jones, B., 2015. "Farmer risk-aversion limits closure of yield and profit gaps: A study of nitrogen management in the southern Australian wheatbelt," Agricultural Systems, Elsevier, vol. 137(C), pages 108-118.
    3. So Pyay Thar & Robert J. Farquharson & Thiagarajah Ramilan & Sam Coggins & Deli Chen, 2021. "Recommended vs. Practice: Smallholder Fertilizer Decisions in Central Myanmar," Agriculture, MDPI, vol. 11(1), pages 1-20, January.
    4. Ridier, Aude & Ben El Ghali, Mohamed & Nguyen, G. & Kephaliacos, Charilaos, 2013. "The role of risk aversion and labor constraints in the adoption of low input practices supported by the CAP green payments in cash crop farms," Revue d'Etudes en Agriculture et Environnement, Editions NecPlus, vol. 94(02), pages 195-219, June.
    5. Ridier, Aude & Chaib, Karim & Roussy, Caroline, 2016. "A Dynamic Stochastic Programming model of crop rotation choice to test the adoption of long rotation under price and production risks," European Journal of Operational Research, Elsevier, vol. 252(1), pages 270-279.

    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. Lien, Gudbrand & Hardaker, J. Brian & Asseldonk, Marcel A.P.M. van & Richardson, James W., 2009. "Risk programming and sparse data: how to get more reliable results," Agricultural Systems, Elsevier, vol. 101(1-2), pages 42-48, June.
    2. Gudbrand Lien & J. Hardaker & Marcel Asseldonk & James Richardson, 2011. "Risk programming analysis with imperfect information," Annals of Operations Research, Springer, vol. 190(1), pages 311-323, October.
    3. Acs, Szvetlana & Berentsen, Paul B.M. & Huirne, Ruud & van Asseldonk, Marcel, 2009. "Effect of yield and price risk on conversion from conventional to organic farming," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 53(3), pages 1-19.
    4. Rosa, Franco, 2014. "Evaluation of risk in farm planning: a case study," 2014 Third Congress, June 25-27, 2014, Alghero, Italy 173126, Italian Association of Agricultural and Applied Economics (AIEAA).
    5. Franco Rosa & Mario Taverna & Federico Nassivera & Luca Iseppi, 2019. "Farm/crop portfolio simulations under variable risk: a case study from Italy," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 7(1), pages 1-15, December.
    6. Heidelbach, Olaf, 2007. "Efficiency of selected risk management instruments: An empirical analysis of risk reduction in Kazakhstani crop production," Studies on the Agricultural and Food Sector in Transition Economies, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), volume 40, number 92323.
    7. J. Pannell, David, 1991. "Pests and pesticides, risk and risk aversion," Agricultural Economics, Blackwell, vol. 5(4), pages 361-383, August.
    8. Barham, E. Hart Bise & Robinson, John R.C. & Richardson, James W. & Rister, M. Edward, 2011. "Mitigating Cotton Revenue Risk Through Irrigation, Insurance, and Hedging," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 43(4), pages 529-540, November.
    9. Asci, Serhat & VanSickle, John J. & Cantliffe, Daniel J., 2014. "Risk in Investment Decision Making and Greenhouse Tomato Production Expansion in Florida," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 17(4), pages 1-26, November.
    10. Lien, Gudbrand D. & Flaten, Ola & Schumann, Keith D. & Richardson, James W. & Korsaeth, Audun & Eltun, Ragnar, 2005. "Comparison of Risk Between Cropping Systems in Eastern Norway," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24663, European Association of Agricultural Economists.
    11. Torkamani, Javad, 2005. "Using a whole-farm modelling approach to assess prospective technologies under uncertainty," Agricultural Systems, Elsevier, vol. 85(2), pages 138-154, August.
    12. Aude Ridier & Mohamed Ben El Ghali & G. Nguyen & Charilaos Kephaliacos, 2013. "The role of risk aversion and labor constraints in the adoption of low input practices supported by the CAP green payments in cash crop farms," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, INRA Department of Economics, vol. 94(2), pages 195-219.
    13. Graham R. Marshall & Kevin A. Parton & G.L. Hammer, 1996. "Risk Attitude, Planting Conditions And The Value Of Seasonal Forecasts To A Dryland Wheat Grower," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 40(3), pages 211-233, December.
    14. Rohrig, Maren B.K. & Hardeweg, Bernd & Lentz, Wolfgang, 2018. "Efficient farming options for German apple growers under risk – a stochastic dominance approach," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 21(01).
    15. Pannell, David J. & Nordblom, Thomas L., 1998. "Impacts of risk aversion on whole-farm management in Syria," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 42(3), pages 1-21.
    16. Pannell, David J., 1988. "Modelling Risk in Linear Programming Using Direct Solution of Linearly Segmented Approximations of the Utility Function," Discussion Papers 315423, University of Western Australia, School of Agricultural and Resource Economics.
    17. Ribera, Luis A. & Outlaw, Joe L. & Richardson, James W. & Silva, Jorge A. da & Bryant, Henry L., 2007. "Mitigating the Fuel and Feed Effects of Increased Ethanol Production Utilizing Sugarcane," Biofuels, Food and Feed Tradeoffs Conference, April 12-13, 2007, St, Louis, Missouri 313700, Farm Foundation.
    18. Hardaker, J. Brian & Lien, Gudbrand, 2010. "Probabilities for decision analysis in agriculture and rural resource economics: The need for a paradigm change," Agricultural Systems, Elsevier, vol. 103(6), pages 345-350, July.
    19. Fan, Yubing & Himanshu, Sushil K. & Ale, Srinivasulu & DeLaune, Paul B. & Zhang, Tian & Park, Seong C. & Colaizzi, Paul D. & Evett, Steven R. & Baumhardt, R. Louis, 2022. "The synergy between water conservation and economic profitability of adopting alternative irrigation systems for cotton production in the Texas High Plains," Agricultural Water Management, Elsevier, vol. 262(C).
    20. Pannell, David J. & Malcolm, Bill & Kingwell, Ross S., 2000. "Are we risking too much? Perspectives on risk in farm modelling," Agricultural Economics, Blackwell, vol. 23(1), pages 69-78, June.

    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:ags:auagre:126084. 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: AgEcon Search (email available below). General contact details of provider: http://www.agrifood.info/review/ .

    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.