Uhrig for helpful comments during development of this study. Ted C. Schroeder and three anonymous reviewers also provided insightful suggestions during the review process.

Beef cattle producers were surveyed in Texas and Nebraska to investigate perceptions of sources of risk, the effectiveness of risk management strategies, and interest in further risk management education, particularly production risk, using probit analysis. Important decision variables identifie are age, prior use of risk management tools, previous attendances of risk management education, and risk aversion. Severe drought and cattle price variability are identifie as primary risk factors with potential to affect farm income. Extremely cold weather and disease are of less importance. Understocking pasture and storing hay are perceived most effective as risk management options. I t is often assumed that the management of risk is of paramount importance to crop and livestock producers (Barry; Hardaker, Huirne, and Anderson). Yet, very little information is available on how livestock producers perceive and manage risk. In this paper, we present the results of a unique large-scale and broadly focused survey of beef producers' perceptions of risk and preferences for risk management. Information is offered on both production and, to a lesser extent, price risk.

A multinomial logit is utilized to model the choice of whether to purchase yield or revenue insurance using subjectively elicited survey data. Our results indicate that the demand for crop insurance is inelastic (20.40), consistent with most earlier yield elasticity estimates, but the elasticity for choices between yield and revenue insurance is found to be relatively more elastic (20.88).

Farm level risk analyses have used price and yield variability almost exclusively to represent risk. Results from a survey of 149 agricultural producers in 12 states indicate that producers consider a broader range of sources of variability in their operations. Significant differences exist among categories with respect to the importance of the sources of variability in crop and livestock production. Producers also used a variety of management responses to variability. There were significant difference among categories in the importance given to particular responses and their use of them. These results have implications for research, extension, and policy programs.

No abstract