Economists attribute many common behaviors to risk aversion and frequently focus on how wealth moderates risk preferences. This paper highlights a problem associated with empirical tests of the relationship between wealth and risk aversion that can arise when the probabilities individuals face...

Temporal climate risk weighs heavily on many of the world's poor. Recent advances in model-based climate forecasting have expanded the range, timeliness and accuracy of forecasts available to decision-makers whose welfare depends on stochastic climate outcomes. There has consequently been...

The literature on economic growth and development has focused considerable attention on questions of risk management and the possibility of multiple equilibria associated with poverty traps. We use herd history data collected among pastoralists in southern Ethiopia to study stochastic wealth...

How and how well growers manage the risks inherent in agriculture has direct welfareimplications for producers and consumers at both local and societal levels. While better weather,pest and disease forecast information are rapidly disseminating among producers and are oftentouted as promising...

Many governments try to stabilize commodity prices based on the widespread belief that households value price stability and that the poor especially benefit from food price stabilization. We derive an exact measure of multivariate price risk aversion and of associated household willingness to...

Entrepreneurship means making discrete changes in livelihood activities that involve substantial risks to income. While the rewards may be substantial, transactions costs may make decisions irreversible. This paper draws a comparison between entrepreneurship and technology adoption. Adopting a...

A general theory is developed to analyze the efficiency and income distribution effects of a biofuel consumer tax credit and the interaction effects with a price contingent farm subsidy. Using the U.S. ethanol market as a stylized example, ethanol prices rise above the gasoline price by the...

This paper analyzes the impact of an ethanol import tariff in conjunction with a consumption mandate and tax credit. A tax credit alone acts as a subsidy to ethanol producers, equally benefiting exporters like Brazil. If an import tariff is imposed to offset the tax credit, world prices of...

An experiment was conducted to investigate the interaction between consumers’ past eating behaviors, risk perceptions and future information processing procedure. In the study, participants were required to choose whether or not to eat chicken that was potentially be tainted with Avian...