DETERMINANTS OF THE VALUE OF SITE-SPECIFIC INFORMATION (SSI) IN AGRICULTURE: A UNIFYING THEORY TO ANALYZE ITS RELATIVE IMPACTS

This paper develops a theoretically consistent behavioral model of farmer decision-making that allows for analysis of the relative impacts of the determinants of SSI value. The model departs from previous literature by assuming that SSI reduces uncertainty, but not eliminate it. Results show that increasing the accuracy (or the "level of informativeness") of SSI, increasing initial wealth, improving management ability to reduce uncertainty in the posterior, and increasing the uncertainty in the prior, increases the value of SSI. Furthermore, mean input use is found to decrease, as SSI becomes more "informative." On the other hand, the value of SSI is found to be decreasing as relative risk aversion increases. These results have policy implications for controlling non-point source pollution from fertilizer inputs and SSI-adoption behavior.


Issue Date:
2000
Publication Type:
Conference Paper/ Presentation
DOI and Other Identifiers:
Record Identifier:
https://ageconsearch.umn.edu/record/21779
PURL Identifier:
http://purl.umn.edu/21779
Total Pages:
28
Series Statement:
Selected Paper




 Record created 2017-04-01, last modified 2020-10-28

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)