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Farmers' Behaviour towards Risk in Production of Fruit and Vegetable Crops
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Within the horticultural sector, fruits and vegetables differ from each other on the basis of gestation period in production that is expected to influence the risk-taking abilities of farmers differently. In this paper, we assess the typology of risks in production of fruits and vegetables, examine the risk attitudes of these farmers under the safety-first framework and identify factors determining their risk-taking behaviour. The results revealed that stabilising the yield of the crop would be much more effective in stabilising revenues of fruits whereas stabilising price, on the other hand, is a more effective strategy to reduce revenue risk of vegetables. Also, the vegetable growers are more risk-takers than fruit growers. The risk attitudes of farmers growing fruits and vegetables are explained by income and farm-related factors including farm size, access to non-farm income, family size and access to credit. Specifically, access to non-farm income and credit helps farmers take more risk in their production of high value horticultural crops.
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