On Crop Biodiversity, Risk Exposure, and Food Security in the Highlands of Ethiopia

• Published in: American journal of agricultural economics Vol. 91; no. 3; pp. 599 - 611
• Main Authors: Di Falco, Salvatore, Chavas, Jean-Paul
• Format: Journal Article
• Language: English
• Published: Malden Blackwell Publishing Inc 01.08.2009; Oxford University Press; Wiley Periodicals, Inc; Blackwell Publishing Ltd
• Subjects: Agricultural economics; Agricultural land; Agricultural production; Agroecology; Barley; Biodiversity; Crop production; Crops; diversity; drought; econometrics; Environmental degradation; estimation; Ethiopia; Evaluation; farm surveys; Food crops; Food security; Food supply; Genetic diversity; genetic variation; grain yield; highlands; Hordeum vulgare; Land; land degradation; landraces; plant genetic resources; Productivity; risk; Risk aversion; Risk exposure; Risk management; Risk premiums; Skewed distribution; Stochastic models; stochastic processes; Studies; Variance; Variance analysis; Ethiopia
• ISSN: 0002-9092; 1467-8276
• DOI: 10.1111/j.1467-8276.2009.01265.x

This paper investigates the effects of crop genetic diversity on farm productivity and production risk in the highlands of Ethiopia. Using a moment-based approach, the analysis uses a stochastic production function capturing mean, variance, and skewness effects. Welfare implications of diversity are evaluated using a certainty equivalent, measured as expected income minus a risk premium (reflecting the cost of risk). We find that the effect of diversity on skewness dominates its effect on variance, meaning that diversity reduces the cost of risk. The analysis also shows that the beneficial effects of diversity become of greater value in degraded land.