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Adoption of climate change mitigation practices by risk-averse farmers in the Ashanti Region, Ghana

Adoption of climate change mitigation practices by risk-averse farmers in the Ashanti Region, Ghana

De Pinto, Alessandro ORCID: 0000-0003-0327-494X, Robertson, Richard D. and Obiri, Beatrice Darko (2012) Adoption of climate change mitigation practices by risk-averse farmers in the Ashanti Region, Ghana. Ecological Economics, 86. pp. 47-54. ISSN 0921-8009 (doi:https://doi.org/10.1016/j.ecolecon.2012.11.002)

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Abstract

Uncertainty and risk-aversion are notably absent in the modeling of farmers' adoption of climate change mitigation practices in developing countries even though most of the agricultural mitigation practices also have effects on yield variability. The objective of this paper is to explore the implications for climate change mitigation projects of modeling farmers as risk neutral while in actuality they behave as risk-averse agents. Results indicate that when risk averse farmers are modeled as risk-neutral agents, the size of the incentives needed to induce participation to a carbon sequestration program is miscalculated with serious implications either for the success for projects that aim at compensating for climate change mitigation services or for the economic efficiency of such projects.

Item Type: Article
Uncontrolled Keywords: carbon payments, climate change mitigation, ecosystem services, risk aversion
Subjects: S Agriculture > S Agriculture (General)
Faculty / Department / Research Group: Faculty of Engineering & Science
Faculty of Engineering & Science > Natural Resources Institute
Faculty of Engineering & Science > Natural Resources Institute > Livelihoods & Institutions Department
Last Modified: 06 Aug 2020 14:23
Selected for GREAT 2016: None
Selected for GREAT 2017: None
Selected for GREAT 2018: None
Selected for GREAT 2019: None
Selected for REF2021: None
URI: http://gala.gre.ac.uk/id/eprint/28926

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