IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

The Effect Of Fertiliser On Risk: A Heteroscedastic Production Function With Measurable Stochastic Inputs

  • Mark W. Rosegrant
  • James A. Roumasset

The sources of production risk are many and diverse in nature. Estimating risk as a black box, without explicit recognition of its sources, can lead to inferior estimates of optimal inputs under risk aversion. In this paper, a method is presented for estimating production functions with measurable stochastic inputs and for generating the parameters of the probability distributions of yield for various environments and input levels. Based on this method, it appears that moderate risk aversion can account for a 6.7 per cent to 16.7 per cent reduction in nitrogen use (relative to the risk-neutral solution) for selected rice producing areas of the Philippines. Estimating optimal inputs without environment specific information about the sources of risk leads to large errors. This underscores the value of collecting information about the sources of risk and of exercising caution when such information is not available.

(This abstract was borrowed from another version of this item.)

If 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.

File URL: http://hdl.handle.net/10.1111/j.1467-8489.1985.tb00651.x
Download Restriction: Access to full text is restricted to subscribers.

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.

Article provided by Australian Agricultural and Resource Economics Society in its journal Australian Journal of Agricultural and Resource Economics.

Volume (Year): 29 (1985)
Issue (Month): 2 (08)
Pages: 107-121

as
in new window

Handle: RePEc:bla:ajarec:v:29:y:1985:i:2:p:107-121
Contact details of provider: Postal: AARES Central Office Manager, Crawford School of Public Policy, ANU, Canberra ACT 0200
Phone: 0409 032 338
Web page: http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1467-8489
Email:


More information through EDIRC

Order Information: Web: http://ordering.onlinelibrary.wiley.com/subs.asp?ref=1467-8489&doi=10.1111/(ISSN)1467-8489

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Byerlee, Derek R. & Anderson, Jock R., 1969. "Value Of Predictors Of Uncontrolled Factors In Response Functions," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 13(02), December.
  2. Amemiya, Takeshi, 1977. "A note on a heteroscedastic model," Journal of Econometrics, Elsevier, vol. 6(3), pages 365-370, November.
  3. Harvey, A C, 1976. "Estimating Regression Models with Multiplicative Heteroscedasticity," Econometrica, Econometric Society, vol. 44(3), pages 461-65, May.
  4. Breusch, T S & Pagan, A R, 1979. "A Simple Test for Heteroscedasticity and Random Coefficient Variation," Econometrica, Econometric Society, vol. 47(5), pages 1287-94, September.
  5. Just, Richard E. & Pope, Rulon D., 1978. "Stochastic specification of production functions and economic implications," Journal of Econometrics, Elsevier, vol. 7(1), pages 67-86, February.
  6. Antle, John M, 1983. "Testing the Stochastic Structure of Production: A Flexible Moment-based Approach," Journal of Business & Economic Statistics, American Statistical Association, vol. 1(3), pages 192-201, July.
  7. Herdt, R W & Mandac, A M, 1981. "Modern Technology and Economic Efficiency of Philippine Rice Farmers," Economic Development and Cultural Change, University of Chicago Press, vol. 29(2), pages 375-99, January.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:bla:ajarec:v:29:y:1985:i:2:p:107-121. See general 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: (Wiley-Blackwell Digital Licensing)

or (Christopher F. Baum)

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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.