Smallholder farmers' risk management and innovation strategies and their impacts on poverty and resilience

在非洲之角，粮食不安全、农业生产率低和贫困现象继续存在，该区域最近的粮食危机就是例证。糟糕的资产禀赋、市场失灵和薄弱的制度阻碍了小农投资于高效的土地利用战略，使他们陷入贫困。许多风险因素，特别是气候变化性，预计将随着气候变化而进一步增加，以及近年来观察到的价格波动加剧，都将限制农民未来提高农业生产率和摆脱贫困的可能性。为了应对不确定的环境，小农户采用各种多样化战略，以最大限度地减少陷入贫困状态的不利风险，包括与作物和牲畜有关的多样化以及非农业活动。分散投资降低总体收益风险的有效性取决于不同收入来源收益的差异和协方差。然而，多样化通常涉及在降低风险和农民和牲畜饲养者能够赚取的收入之间进行权衡。在作物和畜牧业生产中采用农业创新可能会提高生产率和福利；然而，由于资金需求和所涉风险，小农往往无法采用这些创新，因此他们仍然深陷贫困之中。以非洲之角最大的国家埃塞俄比亚为例，拟议研究的目标是确定小农采用重大农业创新的制约因素。因此，农户的风险暴露、风险偏好以及包括非正规金融机构在内的社会网络的作用将成为分析的重点。此外，这些创新对家庭层面的福利影响将被量化。拟议的项目将扩大风险下技术采用分析的研究前沿，预计将大大提高贫穷和高风险农业环境中技术采用模型的解释能力，有助于更有效地制定政策。此外，该项目将通过开发和测试创新的假设和非假设方法来推动社会科学研究方法，以经验地得出农民的风险偏好，这些偏好被假设为风险下技术采用的重要决定因素。

In the Horn of Africa, food insecurity, low agricultural productivity and poverty continue to persist, as illustrated by the recent food crisis in the region. Poor asset endowments, market failures, and weak institutions prevent smallholder farmers from investing in efficient land use strategies, keeping them trapped in poverty. Numerous risk factors, especially climate variability, which is expected to increase further with climate change, and increased price volatility as observed during recent years will constrain farmers` possibilities to enhance agricultural productivity and escape from poverty even more in the future. In response to their uncertain environment, smallholder farmers apply various diversification strategies to minimize the downside risk of falling into a state of destitution, encompassing crop and livestock related diversification as well as off-farm activities. The effectiveness of diversification to reduce overall income risk depends on the variance and covariance of returns from the different income sources. However, diversification typically involves a trade-off between risk reduction and the amount of income that farmers and livestock keepers are able to earn. The adoption of agricultural innovations in crop and livestock production would likely lead to productivity and welfare increases; however, smallholders are often unable to adopt them because of the capital requirements and risks involved and, hence, they remain trapped in poverty. Using Ethiopia, the largest country in the Horn of Africa, as an example, the objective of the proposed research is to identify the constraints to the adoption of major agricultural innovations by smallholder farmers. Hereby, farmers’ risk exposure, risk preferences, and the role of social networks, including informal financial institutions, will be particular foci of the analysis. Moreover, the welfare impact of these innovations at the household level will be quantified. The proposed project will expand the research frontier in the analysis of technology adoption under risk and is expected to considerably improve the explanatory power of technology adoption models in poor and risky agrarian settings, contributing to more effective policy design. Furthermore, the project will advance social science research methods by developing and testing innovative hypothetical and non-hypothetical methods to empirically elicit farmers’ risk preferences, which are hypothesized to be important determinants of technology adoption under risk.