Economic risk and the structural characteristics of farm businesses

Abstract

This study uses farm‐level data from the Illinois Farm Business Farm Management Association to determine whether the variability of net farm income is significantly influenced by farm size, financial structure, and other structural characteristics of farm businesses. The econometric results indicate that under a cross‐sectional model the relative variability of real net farm income is not significantly influenced by farm size, measured either by acreage or value of farm production. However, under a time‐series/cross‐section model, periodic variations in farm size, along with differences in the relative crop price received, crop yield, degree of enterprise diversification, and geographic location, can significantly influence changes in farm income variability.

Factors determining the crop insurance level in Poland taking into account the level of farm subsidising

“…Masara The scale of activity also has a positive impact on the uptake of insurance [Afroz et al, 2017]. This is consistent with the results of many studies [Goodwin, 1993; Barry et al, 2001;Goodwin and Mishra, 2006], according to which the farm size was positively correlated with the decision on taking out crop insurance. It should be stressed that the choice and signing of an insurance contract is a complex decision which, if is to be reasonably made, requires farmers to carry out complex and multifaceted analysis.…”

A Note on the Effects of the Income Stabilisation Tool on Income Inequality in Agriculture

“…face lower (relative) income risks (e.g. Barry et al, 2001;El Benni et al, 2012). Thus, these farmsin contrast to smaller farms with low levels of expected incomemight be less likely to receive indemnification by the IST.…”

Assessing and Understanding the Drivers of Farm Income Risk: Evidence From Slovenia

“…Fifth, farm size is usually considered to explain the level of farm income risk (Barry et al, 2001). The standard assumption is that bigger farms benefit from economies of scale and production efficiencies.…”

“…Risk traditionally plays a considerable role in agricultural production because natural forces are beyond the control of farmers (Barry et al, 2001;Just and Pope, 2003). Besides its relevance at the farm level, income risks are also of significant policy relevance (el Benni et al, 2012;el Benni and Finger, 2013;Cimino et al, 2015).…”