What Determines the Uptake of Multiple Tools to Mitigate Agricultural Risks among Hybrid Maize Growers in Pakistan? Findings from Field-Level Data
Arable farming is an intrinsically risky enterprise. Therefore, managing risks and uncertainties in agriculture is very important as it affects all sectors of the economy of a developing country like Pakistan. To do so, a whole suite of options is available to the farming community to safeguard agai...
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| Format: | Article |
| Language: | English |
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MDPI AG
2021-06-01
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| Series: | Agriculture |
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| Online Access: | https://www.mdpi.com/2077-0472/11/7/578 |
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| author | Shoaib Akhtar Azhar Abbas Muhammad Amjed Iqbal Muhammad Rizwan Abdus Samie Muhammad Faisal Jam Ghulam Murtaza Sahito |
| author_facet | Shoaib Akhtar Azhar Abbas Muhammad Amjed Iqbal Muhammad Rizwan Abdus Samie Muhammad Faisal Jam Ghulam Murtaza Sahito |
| author_sort | Shoaib Akhtar |
| collection | DOAJ |
| description | Arable farming is an intrinsically risky enterprise. Therefore, managing risks and uncertainties in agriculture is very important as it affects all sectors of the economy of a developing country like Pakistan. To do so, a whole suite of options is available to the farming community to safeguard against any type of risk. However, farmers’ behavior of the concurrent adoption of multiple risk management tools is largely ignored in previous studies and has formed the rationale for this research. Thus, the current study is intended to investigate farmers’ decisions of adopting risk management strategies (contract farming, off-farm income diversification, and farm credit use) and to examine the impacts of a variety of factors on farmers’ risk management decisions. The present study is carried out in four districts of Punjab province, Pakistan with a focus on hybrid maize growers. A multivariate probit model is used to evaluate the impacts of independent variables on growers’ choices of adopting contract farming, off-farm income diversification, and farm credit use to manage farm risks keeping in view the potential for the concurrent adoption of these risk management strategies. Results show that 78% of farmers are risk-averse and hence ready to manage risks. The top risk faced by farmers is price risk followed by biological, climatic, and financial risks. Contract farming is the most popular strategy (61% farmers) followed by off-farm income diversification (49% farmers), and the use of farm credit (42% farmers). The findings also reveal that the decisions of adopting risk management strategies are interlinked while the adoption of one risk management tool complements farmers’ decision to adopt other risk management strategies. In addition, the risk management strategies’ adoption choices are affected by the number of factors including socioeconomic characteristics, farmers’ risk perceptions about risk sources, and their attitude towards risk. The study recommends the provision of timely information (climatic, extension) along with easy access to farm credit and the streamlining of contractual arrangements. |
| first_indexed | 2024-03-10T10:06:58Z |
| format | Article |
| id | doaj.art-d4ef13935a8f4cc08c669136b4469e1f |
| institution | Directory Open Access Journal |
| issn | 2077-0472 |
| language | English |
| last_indexed | 2024-03-10T10:06:58Z |
| publishDate | 2021-06-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Agriculture |
| spelling | doaj.art-d4ef13935a8f4cc08c669136b4469e1f2023-11-22T01:29:55ZengMDPI AGAgriculture2077-04722021-06-0111757810.3390/agriculture11070578What Determines the Uptake of Multiple Tools to Mitigate Agricultural Risks among Hybrid Maize Growers in Pakistan? Findings from Field-Level DataShoaib Akhtar0Azhar Abbas1Muhammad Amjed Iqbal2Muhammad Rizwan3Abdus Samie4Muhammad Faisal5Jam Ghulam Murtaza Sahito6Centre of Excellence for Olive Research and Training (CEFORT), Barani Agricultural Research Institute, Chakwal 48800, PakistanInstitute of Agricultural and Resource Economics, University of Agriculture, Faisalabad 38040, PakistanInstitute of Agricultural and Resource Economics, University of Agriculture, Faisalabad 38040, PakistanSchool of Economics and Management, Yangtze University, Jingzhou 434023, ChinaInstitute of Agricultural and Resource Economics, University of Agriculture, Faisalabad 38040, PakistanCollege of Economics and Management, Huazhong Agricultural University, Wuhan 430070, ChinaDepartment of Agricultural Economics, Sindh Agricultural University, Tandojam 70060, PakistanArable farming is an intrinsically risky enterprise. Therefore, managing risks and uncertainties in agriculture is very important as it affects all sectors of the economy of a developing country like Pakistan. To do so, a whole suite of options is available to the farming community to safeguard against any type of risk. However, farmers’ behavior of the concurrent adoption of multiple risk management tools is largely ignored in previous studies and has formed the rationale for this research. Thus, the current study is intended to investigate farmers’ decisions of adopting risk management strategies (contract farming, off-farm income diversification, and farm credit use) and to examine the impacts of a variety of factors on farmers’ risk management decisions. The present study is carried out in four districts of Punjab province, Pakistan with a focus on hybrid maize growers. A multivariate probit model is used to evaluate the impacts of independent variables on growers’ choices of adopting contract farming, off-farm income diversification, and farm credit use to manage farm risks keeping in view the potential for the concurrent adoption of these risk management strategies. Results show that 78% of farmers are risk-averse and hence ready to manage risks. The top risk faced by farmers is price risk followed by biological, climatic, and financial risks. Contract farming is the most popular strategy (61% farmers) followed by off-farm income diversification (49% farmers), and the use of farm credit (42% farmers). The findings also reveal that the decisions of adopting risk management strategies are interlinked while the adoption of one risk management tool complements farmers’ decision to adopt other risk management strategies. In addition, the risk management strategies’ adoption choices are affected by the number of factors including socioeconomic characteristics, farmers’ risk perceptions about risk sources, and their attitude towards risk. The study recommends the provision of timely information (climatic, extension) along with easy access to farm credit and the streamlining of contractual arrangements.https://www.mdpi.com/2077-0472/11/7/578risk perceptionsrisk attitudeconcurrent adoptionmultivariate probit |
| spellingShingle | Shoaib Akhtar Azhar Abbas Muhammad Amjed Iqbal Muhammad Rizwan Abdus Samie Muhammad Faisal Jam Ghulam Murtaza Sahito What Determines the Uptake of Multiple Tools to Mitigate Agricultural Risks among Hybrid Maize Growers in Pakistan? Findings from Field-Level Data Agriculture risk perceptions risk attitude concurrent adoption multivariate probit |
| title | What Determines the Uptake of Multiple Tools to Mitigate Agricultural Risks among Hybrid Maize Growers in Pakistan? Findings from Field-Level Data |
| title_full | What Determines the Uptake of Multiple Tools to Mitigate Agricultural Risks among Hybrid Maize Growers in Pakistan? Findings from Field-Level Data |
| title_fullStr | What Determines the Uptake of Multiple Tools to Mitigate Agricultural Risks among Hybrid Maize Growers in Pakistan? Findings from Field-Level Data |
| title_full_unstemmed | What Determines the Uptake of Multiple Tools to Mitigate Agricultural Risks among Hybrid Maize Growers in Pakistan? Findings from Field-Level Data |
| title_short | What Determines the Uptake of Multiple Tools to Mitigate Agricultural Risks among Hybrid Maize Growers in Pakistan? Findings from Field-Level Data |
| title_sort | what determines the uptake of multiple tools to mitigate agricultural risks among hybrid maize growers in pakistan findings from field level data |
| topic | risk perceptions risk attitude concurrent adoption multivariate probit |
| url | https://www.mdpi.com/2077-0472/11/7/578 |
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