Risk and risk management: an empirical analysis of Dutch livestock farmers

The risk environment of farmers is changing and new risk management strategies are being introduced. This paper studies survey data relating to farmers' perceptions of risk and risk management, and analyses whether characteristics of a farm and/or farmer can be identified that relate to these perceptions. The data originate from a large sample of livestock farmers (n = 612) in the Netherlands and were gathered by a questionnaire survey. Results show that, in general, price and production risks were perceived as important sources of risk, insurance schemes were perceived as relevant strategies to manage risks. More detailed analyses of the perceptions show that dairy farmers generally saw price risks as very important, while pig and mixed farmers were more likely to rank production risks as very important. We found that insurance was perceived relatively less important by mixed farmers than by other farmers.,Although our results indicate that perceptions of risk and risk management are very personal, i.e. farmer-specific, findings have implications for policymakers, advisers, and developers and sellers of (new) risk management strategies. (C) 2001 Elsevier Science B.V. All rights reserved.