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Assisting Whole-Farm Decision-Making Through Stochastic Budgeting

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  • Lien, Gudbrand D.

Abstract

Stochastic budgeting is used to simulate the business and financial risk and the performance over a six-year planning horizon on a Norwegian dairy farm. A major difficulty with stochastic whole-farm budgeting lies in identifying and measuring dependency relationships between stochastic variables. Some methods to account for these stochastic dependencies are illustrated. The financial feasibility of different investment and management strategies is evaluated. In contrast with earlier studies with stochastic farm budgeting, the option aspect is included in the analysis.

Suggested Citation

  • Lien, Gudbrand D., 2002. "Assisting Whole-Farm Decision-Making Through Stochastic Budgeting," 2002 International Congress, August 28-31, 2002, Zaragoza, Spain 24903, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae02:24903
    DOI: 10.22004/ag.econ.24903
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    References listed on IDEAS

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    4. Hardaker, J. Brian, 2000. "Some Issues in Dealing with Risk in Agriculture," Working Papers 12912, University of New England, School of Economics.
    5. 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.
    6. repec:jaa:jagape:v:30:y:1998:i:1:p:35-46 is not listed on IDEAS
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