Diversification as a Form of Risk Management in Agriculture

The objective of this study is to show the importance of diversification in the risk management process. The study areas are: Mato Grosso, with large properties, and Rio Grande do Sul with small. The developed activities are annual cultures and cattle for slaughter. The hypotheses of the work are: a) rural producers diversify their activities using modern techniques. b) Diversification has been efficient in the producers' risks reduction. c) Producers tend be as effective as possible, though they differ in the rates of risk aversion. The MOTAD and E-V models were used.