Agricultural insurance in Indonesia is focused specifically on rice farming and is locally known as Asuransi Usahatani Padi (AUTP). To encourage farmer participation, the government subsidises farmers’ cost of insurance (premium) by 80%. Despite high subsidy, AUTP is still unable to reach the coverage target. The objectives of this study are to investigate farmers’ Risk Aversion Level (RAL), its influence on farmers’ decision to participate in AUTP, and the effect of farmers’ participation in AUTP on their income. The result of this study can contribute to enriching agriculture insurance literature from the point of view of developing countries and catalyse other studies on this matter especially in Indonesia. The analysis methods used in this study were multiple pricelist designs and propensity score matching with a logistic regression model. 130 farmers were interviewed. The results showed that farmers tend to have a high level of risk aversion (82.3% of farmers insure almost all of their land). RAL has a significant effect on farmers’ decision to purchase AUTP (< 0.01). A positive value of Average Treatment on the Treated (ATT) indicated that participation in AUTP has a positive impact on farmers’ income. AUTP is able to absorb production risks and encourage use of high input in farming.

<p>The demand for broiler is rising rapidly due to its capability as the main animal protein source. In contrast, the production of broiler meat is unstable due to the possibility of farm risk. Contract Farming (CF) is one of the risk management tools for farmers but has not been used effectively. The purpose of this study was to analyze the factors that influence farmers’ decision to participate in CF. The analysis used six independent variables, namely farmer’s age, farm size, household size, education, farmer’s risk preference and risk aversion level. This study used primary data from 70 broiler farmers in Jember, which were divided into two groups, contract farmer and independent farmer. Each group had the same number of respondents. The results show that five among six independent variables significantly affected farmers’ decision to take part in CF. Farmer’s age decreased farmer’s probability to participate in CF, while education, farm size, household size and risk preference had positive effects. Farmer’s risk aversion level did not have any significant effect. The results suggest that the effort to expand CF participation should focus on young and educated farmers with large farm size.</p>

Contract farming (CF) has been used extensively to integrate broiler value chain both in the developed and developing countries. Participation in CF is associated with the increased farm productivity and farmer income. Therefore, the purpose of this study was to analyze factors affecting Indonesian broiler farmers' participation in CF. This study used the nationally-representative data of smallholder broiler farmers in Indonesia. The data were the results of the 2014 Indonesian Livestock Farm Household Survey (ILFHS) and consisted of 1,142 farmers distributed in 20 provinces. Logistic regression was used to analyze thirteen factors that potentially affected farmers' decision to participate in CF. Those factors were age, gender, education, household size, farming experience, farm area, broiler population, cooperative membership, cooperative service, farmer group membership, farmer group service, farmer association, and agricultural extension. The results showed that six factors had statistically significant effects on farmers' decision to participate in CF. Education, land size, population, farmer group, and agricultural extension have a positive influence on farmers' decisions. Meanwhile, cooperative service has a negative effect. Farmer group and agricultural extension service have the strongest effect on participation in CF. The results suggest that farmer groups and extension services to small scale farmers are promising to improve their participation in CF.

Glagahwero is one of the largest mushroom producers in Jember, though still lack of production. This research aims to determine factors of production, optimization of production factors, and profit by using optimal production factor. This research was conducted in Glagahwero Village with 32 samples of mushroom farmer. The samples were selected using total sampling method. Data were analyzed using cobb douglas production function to know the factors that significantly influence the production and value of the optimum input use of mushroom farming, and profit analysis to know the comparison of profit value by using the optimum production factor. The results showed that the area of kumbung, seedlings, straw and labor significantly influenced the production of mushroom in Glagahwero but the use of those factors were not optimal (ratio of NPMxi / Pxi> 1), it is necessary to add the amount of production factor use to reach optimal value. The value of profit by using the optimal production factor will be greater than using the actual production factor. The results of this study then become basis in conducting mushroom farming in Glagahwero Village optimally by taking into account the amount of input that use.

Sustainability of agricultural sector, especially within rice commodity which still becomes the main food for most of Indonesian’s, needs attention. Rice farming faces variety of risks and uncertainty conditions such as floods, droughts, and pest attacks. Global climate change in recent years has exacerbated the effects of natural hazards. Agricultural insurance become one solution to overcome farming risk. But in fact, farmers participation level still low. The purpose of this study is to identify the factors that influence farmers' decisions to participate in Rice Farming Insurance (AUTP) as a government-facilitated risk mitigation measure. The study was conducted in Wuluhan Sub-District, Jember Regency with total sample of 130 farmers who were randomly selected. Primary data was collected through interviews by filling out a structured questionnaire. The collected data was processed using logistic regression analysis to determine factors that significantly influence farmers' decisions. The results showed that the risk aversion level, age, experience, land area and crop failure occurence due to pests attack had significance wald test value (partial test) of 0.000; 0.098; 0.022; 0.002; and 0.024. So it can be said that the five variables significantly influence the farmers' decision to participate in AUTP at the confidence level of 95% and 90%.