@article{Hutchings:204434,
      recid = {204434},
      author = {Hutchings, T.R.},
      title = {Financial risk on dryland farms in south-eastern  Australia},
      address = {2013-07},
      number = {671-2016-46495},
      pages = {279},
      year = {2013},
      note = {A thesis submitted for the degree of Doctor of Philosophy,  Faculty of Business, Charles Sturt University.},
      abstract = {Risk is a defining feature of Australian dryland  agriculture, with Australian farmers experiencing a much  higher level of financial risk than any other developed  country. This research shows that this high level of risk  significantly impacts the financial viability of Australian  farms. There is clear evidence which shows that farm  business margins are declining, due to productivity growth  rates lagging current rates of input cost inflation, a  situation which has been exacerbated by a decade of extreme  drought. Consequently Australian farmers are experiencing  difficulty financing record levels of debt from earnings.  Consequently novel management systems, incorporating  appropriate levels of resilience, are critical to the  future growth of the industry.
This thesis describes the  design, development and testing of a simulation model (the  sequential multi-variate analysis, or SMA system) which  offers a practical method of developing these systems and  which is capable of :
* quantifying the financial risks  faced by individual farm businesses.
* simulating the  effects of strategic variations to management in a wide  range of regions, using long-run sequenced rainfall and  commodity prices, and
* quantifying the impact of policy  decisions on farm financial performance under conditions of  historical or forecast risk, an outcome with significant  implications for all levels of management in the Australian  broadacre farming industry.
The SMA system is shown to have  the potential to become a practical and useful aid to all  levels of farm management practice and policy. The results  from a range of case studies suggest that current  best-practice management systems, developed using current  static methods of financial analysis, may be inappropriate  and result in farmers adopting systems with unacceptable  levels of financial risk, which yield sub-optimal financial  returns. These analyses clearly show that farm viability  depends more on minimising losses than maximising  production, and it is these accumulated losses which  threaten farm business survival and growth.},
      url = {http://ageconsearch.umn.edu/record/204434},
      doi = {https://doi.org/10.22004/ag.econ.204434},
}