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Abstract
Investment decisions of farmers can be assumed to be mainly profitability driven.
However, farmers are not only neo-classical entrepreneurs but are also social beings
with families, a social network and surrounding which influences their decisions to
invest or not. We have interviewed 254 farmers face-to-face at an agricultural
exhibition in Germany in order to clarify why some farmers chose not to invest into
biogas plants although the conditions were favourable with fixed prices and average
annual returns on investment of about 10 %. The analysis has been done by using
the logit analysis for three different regions in Germany. The results indicate that
also socio-demographic factors are not significant at a 95 % level marital status as
well as age in the different chosen regions seem to have had an influence on the
investment decision. The paper concludes with a discussion of the results.