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| Nartea, Gilbert V.; Pellegrino, Juan M.; Webster, Paul. |
| Off-farm investment as a risk management strategy is not widespread among New Zealand sheep and beef farmers. This study explores the potential for risk reduction by the diversification of farm asset portfolios to include financial investments such as industrial equities and government bonds of various types. Results show that the negative correlations between long-run rates of return on farm assets and financial investments could result in a significant reduction of risk if equities and bonds were included in farm investment portfolios. However, when combined with information about attitudes to risks, it does not seem likely that farmers would adopt such strategies purely in order to stabilise incomes. Deregulation of the New Zealand economy in the mid... |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Agricultural Finance; Risk and Uncertainty. |
| Ano: 2003 |
URL: http://purl.umn.edu/24376 |
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| Nartea, Gilbert V.; Webster, Paul. |
| This study explores the potential for risk reduction by New Zealand farmers through the diversification of their farm asset portfolios to include financial investments such as ordinary industrial shares, government bonds and bank bills. Low correlations between rates of return on farm and these financial assets suggest that significant reduction of income variability might follow their inclusion in farmers’ portfolios. Stochastic efficiency analysis is used to analyse alternative portfolios of ordinary shares, government bonds and bank bills and New Zealand farmland, using coefficients of absolute risk aversion derived from a negative exponential utility function. The results suggest that those farmers showing high degrees of risk aversion would gain... |
| Tipo: Article |
Palavras-chave: Financial assets; NZ farmland; Risk management; Stochastic efficiency analysis; Agricultural and Food Policy; Risk and Uncertainty. |
| Ano: 2008 |
URL: http://purl.umn.edu/118538 |
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