Journal of Korean Society of Rural Planning (농촌계획)

Korean Society of Rural Planning (한국농촌계획학회)
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Estimating Producer Risk Preferences and Production Responses using a Regional Optimization Model

지역단위 최적화모형을 이용한 농업생산자 위험선호도와 생산반응 분석

  • Kwon, Oh-Sang (Department. of Agricultural Economics and Rural Development and Research Institute of Agriculture and Life Sciences, Seoul National University) ;
  • Lee, Seoungho (Department. of Agricultural Economics and Rural Development, Seoul National University)
  • 권오상 (서울대학교 농경제사회학부, 농업생명과학연구원) ;
  • 이승호 (서울대학교 농경제사회학부)
  • Received : 2020.05.25
  • Accepted : 2020.07.28
  • Published : 2020.08.30
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Abstract

The purpose of this study is constructing a regional-level crop acreage choice model incorporating the impacts of producer risk aversion, and applying the constructed model to the Korean policy that promotes rice paddy conversion into non-rice crop fields. The study adopts the approach of Paris (2018) which estimates the absolute risk aversion coefficient inside of a positive mathematical programming model. A panel data set of 143 cities/counties is used for the empirical study where agricultural land in each region is allocated to 8 crops. Our estimated absolute risk aversion coefficients are smaller than those of Paris (2018), but are a little bit larger than those of the existing Korea studies based on survey or econometric methods. We found that there are close relationships among the estimated risk aversion, regional characteristics, and farming patterns. We also found that incorporating the estimated risk attitudes results in substantial differences in the impacts of the rice paddy conversion policy.

Keywords

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