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ASSESSING PRODUCTION RISKS AND ITS MANAGEMENT STRATEGIES IN AGRICULTURE: A COMPARATIVE STUDY OF TWO DISTRICTS IN BANGLADESH
By: Mst. Suraiya Sultana, Md. Elias Hossain and S. M. Shafiuzzaman
Key Words: Agricultural risk management, Crop diversification, Contract farming, Precautionary savings, Risk Perception
Vol11-No1-p054-66, December 2024.
AbstractThe agriculture of Bangladeshfaces significant risks due to pests and environmental threats,including floods, heavy rains, droughts, hailstorms, cyclones, and extreme weather conditions which cause fluctuations in agricultural output. Farmers adopt various strategies to mitigate these risks. This study examines the risk-related behaviors and risk management strategies of farmers in Sirajganj and Naogaon districts of Bangladesh. To attain the objective, primary data werecollected from 200 farmers and analyzed employing the Arrow-Pratt measurement and Multivariate probit model. The Arrow-Pratt measurement obtained by the ELCL model and cubic utility function, gives risk aversion attitude, and the Multivariate probit regression facilitates to asses risk perception and strategies. Results indicate that farmers in Sirajganjdistrict are more risk-averse (94%) compared to those in Naogaondistrict (61%). This study also revealed that age plays a significant and positive role in both crop diversification and contract farming in Sirajganj district, while in Naogaon district, age only showed a significant impact on crop diversification. Educational status positively affects all outcomes in Sirajganj district, but its effect is mixed in Naogaon district, where it negatively influences contract farming. Land ownership consistently has a negative impact on contract farming in both districts. Off-farm income positively influences crop diversification in both districts but negatively affects contract farming in Sirajganj district, while it was insignificant in Naogaon district. To mitigate the production risk in agriculture, the study suggests strategies that combine technology, crop diversification, contract farming and precautionary savings.
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Mst. Suraiya Sultana, Md. Elias Hossain and S. M. Shafiuzzaman
ASSESSING PRODUCTION RISKS AND ITS MANAGEMENT STRATEGIES IN AGRICULTURE: A COMPARATIVE STUDY OF TWO DISTRICTS IN BANGLADESH
Vol11-No1-p054-66, December 2024.
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