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The different effects of risk preferences on the adoption of agricultural technology: evidence from a rural area in Cambodia

  • Daichi Shimamoto

    ()

    (Graduate School of Economics, Osaka University, Japan. Research Fellow, Japan Society for the Promotion of Science, Japan)

  • Hiroyuki Yamada

    ()

    (Osaka School of International Public Policy, Osaka University, Japan)

  • Ayako Wakano

    ()

    (Graduate School of Economics, Osaka University, Japan)

This paper investigates how farmersf risk attitudes affected the adoption of agricultural technology in a rural area in Cambodia. We incorporated prospect theory to farmersf utility function and examined the effect of the risk attitude of farmers to the adoption of two technologies: adoption of a moisture meter for measuring the moisture content of seeds, a recently introduced post-harvest technology, and a modern rice variety that was introduced in the 1990s. The results indicated that farmers overweighted a small probability and risk averse farmers adopted a moisture meter to measure the moisture contents of seeds significantly. With respect to the modern rice variety, farmersf risk attitude did not affect the adoption. Our results and the results of a previous study imply that the type of risk and uncertainty faced by farmers at the time of decision-making of its adoption partly determine the effect of risk attitude on agricultural adoption.

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File URL: http://www2.econ.osaka-u.ac.jp/library/global/dp/1407.pdf
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Paper provided by Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP) in its series Discussion Papers in Economics and Business with number 14-07.

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Length: 38 pages
Date of creation: Feb 2014
Date of revision:
Handle: RePEc:osk:wpaper:1407
Contact details of provider: Web page: http://www.econ.osaka-u.ac.jp/Email:


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