Technological change and risk management: an application to the economics of corn production

By Kwansoo Kim, Jean-Paul Chavas. 2003

139 citations recorded by the source corpus.

The paper investigates the linkages between technological change and production risk, with an application to corn. The effects of technology on risk exposure are analyzed. We define technological progress to be risk-increasing (risk-decreasing) if it increases (decreases) the relative risk premium. The analysis is applied to panel data from Wisconsin research stations. Conditional moments (including mean, variance and skewness) of corn yield, grain moisture and corn profit are estimated for different sites. We investigate how the trade-off between expected return and the risk premium varies over time and over space. The empirical results indicate that technological progress contributes to reducing the exposure to risk as well as downside risk in corn production, although this effect varies across sites. They also stress the role of the relative maturity of corn hybrids as a means of managing risk. © 2003 Elsevier B.V. All rights reserved.

Subfields: Soil Science

View Paper: https://www.semanticscholar.org/paper/5c88d94bb3aa35d46d3a35e7dd6fa1470666e68d

Citations in the corpus

• Production Risks and Food Security under Alternative Technology Choices in Malawi: Application of a Multinomial Endogenous Switching Regression (2015, unknown): “…(physical conservation structures, improved seeds, crop biodiversity) on production risk mitigation also focused on single technology adoption analysis (Kim and Chavas, 2003; Kassie et al., 2008; Di Falco and Chavas, 2009; Cavatassi et al., 2011; Kato et al., 2011; Di Falco and Veronesi, 2014).”