Bougherara, Douadia and Nauges, Céline (2018) How laboratory experiments could help disentangle the influences of production risk and risk preferences on input decisions. TSE Working Paper, n. 18-903, Toulouse

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Abstract

The purpose of this article is to further our understanding of input choices (such as pesticides or fertilisers) when producers face production risk that depends on a random shock and on the quantity of input used. Using laboratory experiments, we study the role of risk preferences and public policies (here, a lump-sum subsidy and insurance) on producers’ input decisions in two situations: i) a risk-decreasing input; and ii) a risk-increasing input. Our findings raise questions on the sensitivity of optimal input choices to risk preferences and the relevance of the expected utility model to describe farmers’ decisions.

Item Type: Monograph (Working Paper)
Language: English
Date: March 2018
Place of Publication: Toulouse
Uncontrolled Keywords: laboratory experiment, input choice, production risk, risk preferences, subsidy, insurance
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse)
Institution: Université Toulouse 1 Capitole
Site: UT1
Date Deposited: 24 Apr 2018 11:21
Last Modified: 02 Apr 2021 15:57
OAI Identifier: oai:tse-fr.eu:32566
URI: https://publications.ut-capitole.fr/id/eprint/25886
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