벼 재배방법에 따른 기대소득의 확률우위성 분석

Stochastic Dominance Analysis of Expected Income by Rice Cultivation Practices

Recently, no-tillage cultivation practice of rice are receiving great attention from agricultural researchers, policy makers and farmers because it is related to environmentally friendly practice to reduce carbon and greenhouse gasses and to cope with labor shortage and rapid aging of workforce in the agricultural sector. Among the interest groups, farmers are final decision makers weather to accept or not the practice compared to other cultivation practices of rice is available to farmers, especially regarding the economic outcome under uncertainty. Fortunately, National institute of Crop Science(NICS) produced data for yields and greenhouse gas emissions from several practices including no-tillage practice with three years experiments in rice fields. This study analysis the economic outcome of several cultivation practices under uncertainty with the field data obtained from NICS from 2014 to year 2016, during which the practices include tillage, wet-direct seeding, partial tillage and no-tillage. For the analysis we introduce farmers risk preference to reflect his/her risk averse attitude and adopt stochastic dominance analysis, which are basically grounded on simulation techniques and utility function. We form empirical distribution functions and beta distribution functions for each alternative practice, where the former are based on empirical field data and latter based on the best fitted distribution functions from empirical data. The negative exponential utility function is adopted to refect farmers risk aversion coefficient with constant absolute risk aversion(CARA). This study also provides confidence premium(risk premium) that makes indifferent between the most preferred practice(the base practice) and the comparable alternatives according to the mix of risk preference and magnitude of cost saving. The premium is a kind of compensation to be given to farmers for choosing one alternative to the other alternative. The bigger the premium, the harder the alternation of alternatives from the most preferred practice(the base practice). This study is expected to be helpful to farmers decision making for adoption of cultivation practices of rice. Farmers can choose the best alternative according to their risk preference among the rankings of alternatives determined by the mix of risk preference and magnitude of cost saving. In addition, policy makers can choose any alternatives desirable to protect the environment and support the selected alternative with appropriate government programs.