Recent applications of risk analysis in corporate finance to farm firm decision making are reviewed in this paper. The inclusion of risk parameters modifies some of the traditional agricultural economics views on investment, financing and the portfolio choice problem. A clearer view emerges of farm investment behaviour. Further topics for research are identified. In the author's view, the corporate finance analysis provides a more coherent set of paradigms that explain actual farm investment and financing decision making m a more satisfactory way than previously available.