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The aim of this study was to evaluate determinants of four diversification practises by cocoa smallholders in West Sulawesi, Indonesia: (1) growing other crops, (2) keeping livestock, (3) off-farm work for wages (4) off-farm self-employment, and the impact of diversification on welfare of community members.

Household interviews (n = 116) conducted in two subdistricts (Anreapi and Mapilli) of Polewali-Mandar District, West Sulawesi, provided quantitative data on household characteristics, crop and livestock production, income sources, expenditure and credit access. Two villages per subdistrict were included in the study, each producing cocoa as the main crop but differing in their proximity to a market town. Logistic regression was applied to identify determinants of diversification by households. Multiple linear regression (MLR) models evaluated the impact of diversification practices and other explanatory variables on two proxies of welfare (or household wealth): per capita value of durable assets (household assets other than land or livestock) and per capita expenditure for each household.

Mean per capita cocoa production in the sample was low (51 kg dry beans/annum). The mean dependency ratio (proportion of household occupants age <18 and >64) was 35%, with an average of five occupants per household. Household heads were predominantly male (95%), averaging 46 yo and 7 years of formal education. Most households (72%) depended on loans, but only 24% accessed formal loans. Significant determinants of diversification practices were access to formal credit for self-employment and subdistrict for livestock, with Mapilli subdistrict households more likely to keep livestock. Household predictors in the MLR accounted for 28% variation of the dependent, per capita value of durable goods. Off-farm self-employment and raising livestock significantly improved welfare, but growing other crops or off-farm work for wages had little effect. Other household variables demonstrated to have significant positive effects on welfare were education of the household head, proximity to a market town and land area per household.

The study was restricted to a relatively small sample size (n = 116). Studies including panel data or larger numbers of households could enable the identification of further determinants of diversification.

The study demonstrates that diversification has the potential to improve rural livelihoods, but that obstacles, especially formal credit access, may deter poorer households from diversifying their income sources.

Programs and policies that facilitate access to formal finance by smallholders could encourage diversification into small business and improve livelihoods in cocoa-dependent communities.

In the light of the decline in cocoa farm productivity in West Sulawesi, the study demonstrates the potential benefits, as well as limitations, of income diversification by smallholders.

Over the past decade, biofuels production in the European Union and the United States has boomed – much of this due to government mandates and subsidies. The United States has now surpassed Brazil as the world's leading producer of ethanol. The economic and environmental impact of these biofuel programs has become an important question of public policy. Due to the complex intersectoral linkages between biofuels and crops, livestock as well as energy activities, CGE modeling has become an important tool for their analysis. This chapter reviews recent developments in this area of economic analysis and suggests directions for future research.

Crop insurance and hedging are two risk management strategies used by farmers to manage risk. Using a discrete choice model and farm‐level data, this study investigates the factors influencing farmers’ use of hedging and crop insurance as risk management strategies. In the case of crop insurance, results indicate that level of education, participation in other risk management strategies (such as renting land, commodity programs, spreading sales over the year), and controlling debt are positively related to a farmer’s decision to purchase crop insurance. For the hedging model, results suggest education, off‐farm income, forward contracting sales of crops and livestock, and computer use are positively related to a farmer’s articipation in hedging/futures markets.

This paper aims to understand the perception of smallholder farmers on climate change, identify major livestock related climate change adaptation (CCA) strategies and their determinants in selected neighboring districts of Tigray and Amhara regions of Ethiopia.

A total of 416 household heads were involved in a questionnaire survey using a multistage sampling approach. To understand the socio-economic factors that influence farmers’ perception on climate change (CC) and/or variability, a binary logit model was used. Multinomial logit model was used to identify the determinants of smallholder farmers’ choices of adaptation strategies.

Milk reduction, weight loss, feed shortage and frequent animal disease outbreak were indicated as major impacts of CC on livestock production. About 86.2% of the farmers’ exercise CCA measures where livestock health care and management (25%), followed by livelihood diversification (21.5%) and shifting and diversification of livestock species (20.9%) were the top three adaptation measures implemented. Education, knowledge on CCA strategies, access to veterinary service and extension, market access, annual income, non-farm income, total livestock unit, sex of household head and household size were the major determinant factors to farmers’ choice of CCA.

Concerned authorities working in CC related sectors should give due attention to improve smallholder farmers’ access to extension and veterinary services, market access and climate information to enhance their adaptive capacity to CC impacts. In addition, incorporating climate change awareness trainings into the existing extension packages is crucial to enhance the awareness of farmers on climate change and implement appropriate adaptation strategies. Moreover, it is very essential to provide appropriate herd management and marketing strategy based on the production system to avoid the significant price reduction during drought periods.

Concerned authorities working in CC related sectors should give due attention to improve smallholder farmers’ access to extension and veterinary services, market access and climate information to enhance their adaptive capacity to CC impacts. In addition, incorporating climate change awareness trainings into the existing extension packages is crucial to implement appropriate adaptation strategies. Moreover, it is very essential to provide appropriate herd management and marketing strategy based on the production system to avoid the significant price reduction during drought periods.

This research is focused on smallholder crop-livestock farmers, livestock-based CCASs and presents the determinant factors to their choice of adaptation.

The purpose of this paper is to investigate farmers’ risk aversion using the equally likely certainty equivalent approach and the negative exponential utility function to identify risk preference classification.

Stochastic efficiency with respect to a function is applied to determine the risk efficient farming systems for the farmers in central and north-east regions of Thailand.

The study results showed that maize followed by sorghum is the most risk efficient farming system for the extremely risk averse rain-fed farmers in the central region of Thailand. Intensive planting of wet rice and dry rice cultivation is preferred by the extremely risk averse central region irrigated farmers. Wet rice and cassava together with raising small herd of cattle is the most economically viable farming system for the extremely risk averse rain-fed farmers in the north-east region, while two rice crops with raising cattle is preferred by the extremely risk averse north-east irrigated farmers of Thailand.

The findings of this study provide useful information to reinforce the empirical basis for risk analysis for Thai farmers. The results will provide more accurate information regarding risk at the farm level to policy makers and researchers.

This study aims to examine the effect of climate variability on smallholders’ crop income and the determinants of indigenous adaptation strategies in three districts (Mieso, Goba-koricha and Doba) of West Hararghe Zone of Ethiopia. These three districts are located in high-moisture-stress areas because of crop season rainfall variability.

Primary data collected from 400 sample households were used for identifying factors that affect households’ crop income. The study used ordinary least square (OLS) regression to examine the effect of climate variability. Given this, binary logit model was used to assess smallholders’ adaptation behavior. Finally, the study used multinomial logistic regression to identify determinants of smallholders’ indigenous adaptation strategies.

The OLS regression result shows that variability in rainfall during the cropping season has a significant and negative effect, and cropland and livestock level have a positive effect on farmers’ crop income. The multinomial logistic regression result reveals that households adopt hybrid crops (maize and sorghum) and dry-sowing adaptation strategies if there is shortage during the cropping season. Variability in rainfall at the time of sowing and the growing are main factors in the area’s crop production. Cropland increment has positive and significant effect on employing each adaptation strategy. The probability of adopting techniques such as water harvesting, hybrid seeds and dry sowing significantly reduces if a household has a large livestock.

The three districts are remote and accessibility is difficult without due support from institutions. Thus, this study was conducted on the basis of the primary data collected by the researchers after securing grant from Swedish International Development Agency (SIDA).

The purpose of this research is examine the development of livestock mortality insurance, and associated challenges, in order to provide an improved understanding regarding the operation of livestock mortality insurance.

In a many countries, livestock mortality insurance has been either unavailable or underdeveloped. A descriptive analysis is provided regarding the background and development of livestock mortality insurance, along with an example.

Livestock mortality insurance is considerably more complex than crop insurance, and some of the complexities of livestock mortality insurance include multi‐stage production, consequential losses, occasional large event losses, animal health management, moral hazard, and adverse selection.

This study provides background and development information regarding livestock mortality insurance, and also highlights a number of important differences between livestock mortality insurance and crop insurance.

The purpose of this paper is to examine the impact of changes in farm economic conditions and macroeconomic trends on US farm capital expenditures between 1996 and 2013.

A synthetic panel is constructed from Agricultural Resource Management Survey (ARMS) data. A dynamic system GMM regression model is estimated for farms as a whole and separately within farm typology categories. The use of farm typologies allows for comparison of the relative magnitudes of these estimates across farms by farm sales level and the operator’s primary occupation.

Changes in gross farm income levels, tax depreciation rates, and interest rates have a significant impact on crop farm investment, while changes in output prices, net cash farm income levels, tax depreciation rates, and farm specialization levels have significant impacts on livestock farm capital investment. The relative significance and magnitudes of these impacts differ within farm typologies. Significant differences include a greater responsiveness to change in tax policy variables for residential crop farms, greater responsiveness to changes in output prices and debt to asset ratios for intermediate livestock farms, and larger changes in commercial crop and livestock farm investment given equivalent changes in farm sales or the returns to investment.

These findings are of interest to agricultural economists when constructing farm investment models and employing pseudo panel methods, to those in the agricultural equipment and manufacturing sector when constructing models to manage inventories and plan for production needs across regions and over time, to those involved in drafting tax policy and evaluating the potential impacts of tax changes on agricultural investment, and for those in the agricultural lending sector when designing and executing agricultural capital lending programs.

This study uniquely identifies differences in the level of investment and the magnitude of investment responsiveness to changes in farm economic conditions and macroeconomic trends given differences in income levels and primary operator occupation. In addition, this study is one of the few which utilizes ARMS data to study farm capital investment. Utilizing ARMS data provides a rich panel data set, covering producers across many different crop production types and regions. Finally, employing pseudo panel construction methods contributes to efforts to effectively employ cross-sectional data and dynamic models to study farm behavior across time.

This paper investigates Chinese agricultural insurance agents willingness to offer (WTO) livestock insurance based on the variations of eight main attributes of livestock insurance.

This study implements discrete choice experiments (DCE) with actual insurance agents who design, sell and operate livestock insurance in China. The choice experiment of this study is based on the D-optimal approach, a six-block design, with 15 cards per block and two choices per card. The sample size was 211. Econometrics results are based on conditional and mixed logit models.

The authors find that the subsidy effect is enormous; a one level increase of subsidy leads to 3.166 times higher probability to offer. This subsidy effect is important as it confirms the endogenous structure between price and quantity in insurance offering, where subsidy does not only incentivize demand but also the supply. Another main factor of insurance investigated is the impact of different coverage types on agents' WTO. The authors find that agents prefer mortality insurance the most, followed by revenue insurance and profit insurance, while Index-Based Livestock Insurance (IBLI) is the least preferred to offer. Agents' knowledge about these newer types of insurance supports their WTO as well; thus, proper education is necessary to promote the more advanced types of livestock insurance.

A limitation is that in the presence of COVID 19, and administrative issues at the local level, the sample was not randomly drawn. Nonetheless, the authors believe that there is enough diversity across participants, insurers and provinces and have done sufficient robustness checks to support results and conclusions.

This study provides further validation for the DCE research method that could potentially be applied to different analyses: using choice experiments to study insurers and reveal their preferences, through combinations of various levels of core attributes for insurance products. The findings and contribution are critical to the reform and improvement of livestock insurance in China and for insurance markets more broadly. The authors find that insurers do not place equal weights or values on insurance product attributes and do not view types of insurance equally. In other words, while farmers may hold different preferences about the type of insurance they demand, the results suggest that insurers also hold preferences in the type of insurance they sell.

So far as the authors are aware, this is the first DCE designed around the supply of insurance products with the subjects being insurance agents, marketers and executives.

Food security is at risk from climate change. In fact, climate change and its drivers already affect food production through increased temperatures, changed precipitation patterns, extreme event frequency, and escalated carbon dioxide (CO₂) and ozone. These effects are expected to continue for the foreseeable future. This will cause changes to agricultural production worldwide with regional consequences for global food security. In the face of this, adaptations must be pursued that help agriculture maintain and enhance productivity under climate change while meeting growing demands for food. This chapter reviews the current literature on the impacts of climate change on agriculture and possible adaptation strategies to combat its effects. Specifically, this chapter focuses on research conducted on crop systems, livestock, fisheries, and food access.

This study concluded that food production systems around the world will be altered unevenly by climate change, with some gaining and many losing. Possible adaptation strategies will be suggested and successful implementation will need to include both public and private actions.

Given the inevitability of climate change impacting agricultural systems, adapting to the impacts is necessary to maintain future food security. More research is encouraged to determine how to best incorporate multiple systems, actors, and interests in adaptation, as well as how to best respond to the imminent threat to the food system.