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Nainggolan, Lukas Bonar, 2022. Risk preferences of agricultural students and their willingness to become a farmer. Second cycle, A2E. Uppsala: SLU, Dept. of Economics



This study investigates the link between risk preferences of agricultural students and their willingness to become a farmer. I measure willingness to become a farmer and risk preferences in an online survey and incentivized experiment conducted with 577 students at Bogor Agricultural University, Indonesia. Discriminating between alternative theories of decision-making under risk, I find that students’ risk preferences behave in accordance with Cumulative Prospect Theory (CPT), whereas there is no connection between risk preferences and students’ willingness to become a farmer. Framing the risky gamble tasks in either an agricultural or a general entrepreneurship context does not help in improving the predictive power of the tasks. Based on a large sample with high statistical power, these results contribute to the debates on risk preferences in agriculture as well as methodological studies on the external validity of behavioral field experiments. I also discuss the impact of socio-economic background variables as they relate to generation renewal and the so-called “young farmer problem” in agriculture.

Main title:Risk preferences of agricultural students and their willingness to become a farmer
Authors:Nainggolan, Lukas Bonar
Supervisor:Rommel, Jens
Examiner:Hart, Robert
Series:Examensarbete / SLU, Institutionen för ekonomi
Volume/Sequential designation:1452
Year of Publication:2022
Level and depth descriptor:Second cycle, A2E
Student's programme affiliation:NM031 Agricultural Economics and Management - Master's Programme, 120.0hp
Supervising department:(NL, NJ) > Dept. of Economics
Keywords:risk preferences, cumulative prospect theory, agricultural students, experiment, generation renewal, Indonesia
Permanent URL:
Subject. Use of subject categories until 2023-04-30.:Economics and management
Deposited On:15 Jul 2022 12:18
Metadata Last Modified:16 Jul 2022 01:06

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