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A comparison of hypothetical risk attitude elicitation instruments for explaining farmer crop insurance purchases

Year: 2015

Type: article

Abstract: This article presents evidence on the stability and behavioural validity of alternative survey mechanisms for eliciting farmers' attitudes towards risk. Three hypothetical instruments are considered that differ in terms of the simplicity, context and payoff scale of the decision presented to respondents. Responses are assessed in terms of their relative ability to explain actual farmer crop insurance purchases. Results indicate that measures of risk attitudes are poorly correlated across alternative mechanisms. The strongest positive evidence of behavioural validity is found for the gamble task explicitly defined in the context and scale of farmers' economic activities pertaining to their insurance purchase decision.

Source: European Review of Agricultural Economics

DOI: 10.1093/erae/jbv013

Authors: Luisa Menapace, Gregory Colson, Roberta Raffaelli

Institutions: Technical University of Munich, University of Georgia, University of Trento

Language: English

Topic: Decision-Making and Behavioral Economics

Subfield: General Decision Sciences

Field: Decision Sciences

Domain: Social Sciences

SDG: Zero hunger

Open Access status: green

OpenAlex ID: W574035066