IDEAS home Printed from https://ideas.repec.org/a/rfa/aefjnl/v3y2016i4p157-167.html
   My bibliography  Save this article

Price and Yield As Sources of Variability of Farm Revenues in Transition Economies: The Case of Armenia

Author

Listed:
  • Simone Severini
  • Giuliano Di Tommaso
  • Hovhannes Harutyunyan
  • Antonella Tantari

Abstract

In transition economies, the shift to a market system has been accompanied by relevant evolutions of farm income level. Sustainability of farming depends not only on the level but also on the variability of economic results over time. Climatic changes and increasing market uncertainty make small-scale farmers particularly vulnerable to this. This paper analyses revenue variability of the five main crops in Armenia and, by using variance decomposition, it assesses what portion of it is associated with prices and yields and whether a natural hedge exists. The analysis accounts for presence of trends in yield, price and revenue - a situation commonly encountered in transition economies. Variability of revenues of single crops is high. While in some crops the variance associated with price exceeds that of yield, in other cases the opposite occurs. Policy and methodological insights regarding how to manage and to study revenue risk in transition economies are discussed.

Suggested Citation

  • Simone Severini & Giuliano Di Tommaso & Hovhannes Harutyunyan & Antonella Tantari, 2016. "Price and Yield As Sources of Variability of Farm Revenues in Transition Economies: The Case of Armenia," Applied Economics and Finance, Redfame publishing, vol. 3(4), pages 157-167, November.
  • Handle: RePEc:rfa:aefjnl:v:3:y:2016:i:4:p:157-167
    as

    Download full text from publisher

    File URL: http://redfame.com/journal/index.php/aef/article/view/1695/1878
    Download Restriction: no

    File URL: http://redfame.com/journal/index.php/aef/article/view/1695
    Download Restriction: no

    References listed on IDEAS

    as
    1. Oscar R. Burt & Robert M. Finley, 1968. "Statistical Analysis of Identities in Random Variables," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 50(3), pages 734-744.
    2. Joleen C. Hadrich, 2013. "Quantifying the sources of revenue variation in the Northern Great Plains," Agricultural Finance Review, Emerald Group Publishing, vol. 73(3), pages 493-506, November.
    3. Offutt, Susan E. & Blandford, David, 1986. "Commodity market instability : Empirical techniques for analysis," Resources Policy, Elsevier, vol. 12(1), pages 62-72, March.
    4. Christopher A. Wolf & J. Roy Black & Joleen C. Hadrich, 2009. "Upper Midwest dairy farm revenue variation and insurance implications," Agricultural Finance Review, Emerald Group Publishing, vol. 69(3), pages 346-358, November.
    5. Ashok K. Mishra & Carmen L. Sandretto, 2002. "Stability of Farm Income and the Role of Nonfarm Income in U.S. Agriculture," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 24(1), pages 208-221.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Farm revenue risk; market and climatic uncertainty; transition economies; variance decomposition; Armenia.;

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

    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:rfa:aefjnl:v:3:y:2016:i:4:p:157-167. 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: (Redfame publishing). General contact details of provider: http://edirc.repec.org/data/cepflch.html .

    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 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.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.