Analysing the role of risk and uncertainty in production and risk management decisions of farms and farm households

In recent years, risk analysis and risk management have come to the fore of agricultural research and driven policy discussions regarding European and global agricultural production. Indeed, numerous changes in the agricultural production chain such as increased globalization and liberalization, climatic changes and a growing awareness for environmental and animal welfare have made several types of risk increasingly important. In order to be able to predict sectorial responses to these changes in risk conditions and to anticipate the outcome of risk-related policies, a sound understanding of farmers’ and farm households’ risk behaviour is essential.

This research project is aimed at analysing the role of risk and uncertainty in the production and risk management decisions of farms and farm households using applied micro-econometric techniques. Applications will be made to both developed as developing countries. More specific objectives include:
• Assessing the role of risk in farm and farm household decision making
- Investigating the relationship between diverse risk sources
- What decision tools can be implemented to aid decision making
- Scrutinizing the link between risk and the productivity/efficiency of farm households
• Analysing farm risk management choices
- Exploring the interaction between alternative instruments
- Selecting optimal risk management portfolios
• Exploring the interaction between farm and farm household decisions
• Study risk, risk management and vulnerability in a development context