Poverty and Farmers' Attitude Towards Risk: Evidence from Ethiopia

The standard theory of farmers¿ risk attitude shows that farmers are risk averse. This behavior could affect their productivity. It was important to find the significant determinants of risk. Most study revealed that socio-economic determinants influence farmers¿ decision to adopt new agricultural inputs that would enhance productivity. However, the findings may vary based on place and time that needs verification. Therefore, it is important to address the issue before implementation of some policies towards the use of modern agricultural inputs. Though this theory was used for most agricultural policies especially in developing countries, it requires updated findings on the determinants. The dynamic nature of the world still requires for a more determinants of the risk aversion behavior of farmers.