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Simultaneous adoption of risk management strategies to manage the catastrophic risk of maize farmers in Bangladesh

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Abstract

Risk and uncertainty are distinctive features of agricultural cultivation, which significantly affect the production and income. Risk management is an important way for farmers to reduce uncertainty. But little literature is available on simultaneous adoption of different risk management strategies and the possible correlations and impact. This study surveyed 350 maize farmers in four different agro-ecological districts in Bangladesh through stratified random sampling and explored the impacts of social and farm features, farmers’ perceptions about catastrophic risk and their attitude towards risk sources, and the possible correlations among contract farming, diversification and agricultural credit as for risk management strategies by employing multivariate probit model. The results confirmed the correlation among the adoptions of different risk management strategies and revealed that a single risk management strategy could encourage farmers to adopt another one or two risk management strategies simultaneously. Furthermore, the findings explored that age, educational status, extension contact, monthly family income, farm size, farmland ownership, and farmers’ risk-averse nature were the most influencing factors for risk management strategies adopted. Also, the findings from the multivariate probit model provided further interpretations and information which will help in a better understanding of farmer’s behavior about managing different catastrophic risks and will give a platform for policymakers to anticipate suitable risk management strategies for farmers.

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Acknowledgments

The authors want to thanks those farmers for given their time and data to support this research.

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Authors and Affiliations

  1. College of Economics and Management, Huazhong Agricultural University, No.1, Shizishan Street, Hongshan District, Wuahn, Hubei, 430070, P.R. China

    K. M. Mehedi Adnan & Liu Ying

  2. Department of Agricultural Finance & Banking, Sylhet Agricultural University, Sylhet-3100, Bangladesh

    K. M. Mehedi Adnan

  3. Hubei Collaborative Innovation Center for Grain Industry, Yangtze University, Jingzhou, 434025, P.R. China

    Liu Ying

  4. School of Economics & Management, University of Chinese Academy of Sciences, Beijing, P.R. China

    Swati Anindita Sarker

  5. Department of Agricultural Economics, EXIM Bank Agricultural University Bangladesh, Chapainawabganj-6300, Bangladesh

    Swati Anindita Sarker

  6. Department of Agriculture and consumer science, Tarleton State University, Box: T0040, Stephenville, TX, 76402, USA

    Man Yu

  7. Department of Agricultural Economics, Faculty of Agriculture, Al-Azhar University, Assuit, Egypt

    Moataz Eliw

  8. School of Economics and Management, Nanchang University, Nanchang, Jiangxi, P.R. China

    Md. Reza Sultanuzzaman

  9. State Key Laboratory of Information Engineering in Surveying, Mapping and Remote Sensing, Wuhan University, Wuhan, 430079, China

    Md. Enamul Huq

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  1. K. M. Mehedi Adnan
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Table 5 Example to elicit certainty equivalents (CE) and compute utility values (UV)
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Adnan, K.M.M., Ying, L., Sarker, S.A. et al. Simultaneous adoption of risk management strategies to manage the catastrophic risk of maize farmers in Bangladesh. GeoJournal 86, 1981–1998 (2021). https://doi.org/10.1007/s10708-020-10154-y

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