RISK ASSESSMENT AND PROBABILITY ASSESSMENT: A COMPARATIVE ANALYSIS
With the possibility of uncertain events such as those that affect agricultural production, risk assessment is often made by a conservative method that does not require proposal of a distribution function. However, that method will always overestimate the riskiness of an activity with respect to the application of a probability model. In order to assess how large is this departure relative to a specific model, two methods were compared when applied to a sample of wheat (Triticum aestivum L.) producers in which income is approximated by a three-parameter beta distribution and a logarithmic utility function. It was found that the estimation of the risk premium can be reduced up to 1.52 times with respect to the conservative method.
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Colegio de Postgraduados
1999
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oai:ojs.pkp.sfu.ca:article15892020-05-14T14:25:09Z RISK ASSESSMENT AND PROBABILITY ASSESSMENT: A COMPARATIVE ANALYSIS EVALUACION DEL RIESGO Y EVALUACION DE PROBABILIDADES: UN ANALISIS COMPARATIVO Martínez-Damián, Miguel A. Triticum aestivum risk premium beta distribution agricultural economics Triticum aestivum prima de riesgo distribución beta economía agrícola With the possibility of uncertain events such as those that affect agricultural production, risk assessment is often made by a conservative method that does not require proposal of a distribution function. However, that method will always overestimate the riskiness of an activity with respect to the application of a probability model. In order to assess how large is this departure relative to a specific model, two methods were compared when applied to a sample of wheat (Triticum aestivum L.) producers in which income is approximated by a three-parameter beta distribution and a logarithmic utility function. It was found that the estimation of the risk premium can be reduced up to 1.52 times with respect to the conservative method. Ante eventos inciertos como son los que afectan la producción agrícola, la evaluación del riesgo muchas veces se hace mediante algún método conservador que no requiere proponer una función de distribución. Sin embargo, ese método siempre sobreestimará lo riesgoso de una actividad con respecto a la aplicación de un modelo probabilístico. Para evaluar qué tan grande es dicha desviación con respecto a un modelo específico, se compararon dos métodos aplicados a una muestra de productores de trigo (Triticum aestivum L.), en la que se aproximó al ingreso con una función de distribución beta en tres parámetros y una función de bienestar logarítmica. Se encontró que la estimación de la prima de riesgo se puede reducir hasta en 1.52 veces con respecto al método conservador. Colegio de Postgraduados 1999-03-31 info:eu-repo/semantics/article info:eu-repo/semantics/publishedVersion Artículo revisado por pares application/pdf https://www.agrociencia-colpos.org/index.php/agrociencia/article/view/1589 Agrociencia; Vol. 33 No. 1 (1999): 1999-ene-mar; 119-122 Agrociencia; Vol. 33 Núm. 1 (1999): 1999-ene-mar; 119-122 2521-9766 1405-3195 spa https://www.agrociencia-colpos.org/index.php/agrociencia/article/view/1589/1589 |
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COLPOS |
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México |
| countrycode |
MX |
| component |
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| databasecode |
rev-agrociencia-mx |
| tag |
revista |
| region |
America del Norte |
| libraryname |
Departamento de documentación y biblioteca de COLPOS |
| language |
spa |
| format |
Digital |
| author |
Martínez-Damián, Miguel A. |
| spellingShingle |
Martínez-Damián, Miguel A. RISK ASSESSMENT AND PROBABILITY ASSESSMENT: A COMPARATIVE ANALYSIS |
| author_facet |
Martínez-Damián, Miguel A. |
| author_sort |
Martínez-Damián, Miguel A. |
| title |
RISK ASSESSMENT AND PROBABILITY ASSESSMENT: A COMPARATIVE ANALYSIS |
| title_short |
RISK ASSESSMENT AND PROBABILITY ASSESSMENT: A COMPARATIVE ANALYSIS |
| title_full |
RISK ASSESSMENT AND PROBABILITY ASSESSMENT: A COMPARATIVE ANALYSIS |
| title_fullStr |
RISK ASSESSMENT AND PROBABILITY ASSESSMENT: A COMPARATIVE ANALYSIS |
| title_full_unstemmed |
RISK ASSESSMENT AND PROBABILITY ASSESSMENT: A COMPARATIVE ANALYSIS |
| title_sort |
risk assessment and probability assessment: a comparative analysis |
| description |
With the possibility of uncertain events such as those that affect agricultural production, risk assessment is often made by a conservative method that does not
require proposal of a distribution function. However, that method will always overestimate the riskiness of an activity with respect to the application of a probability model. In order to
assess how large is this departure relative to a specific model, two methods were compared when applied to a sample of wheat (Triticum aestivum L.) producers in which income is approximated
by a three-parameter beta distribution and a logarithmic utility function. It was found that the estimation of the risk premium can be reduced up to 1.52 times with respect to the
conservative method. |
| publisher |
Colegio de Postgraduados |
| publishDate |
1999 |
| url |
https://www.agrociencia-colpos.org/index.php/agrociencia/article/view/1589 |
| work_keys_str_mv |
AT martinezdamianmiguela riskassessmentandprobabilityassessmentacomparativeanalysis AT martinezdamianmiguela evaluaciondelriesgoyevaluaciondeprobabilidadesunanalisiscomparativo |
| _version_ |
1807208680231272448 |