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Incorporating Government Program Provisions into a Mean-Variance Framework

Published online by Cambridge University Press:  05 September 2016

Gregory M. Perry ,
M. Edward Rister ,
James W. Richardson  and
David A. Bessler
Gregory M. Perry
Affiliation:
Department of Agricultural and Resource Economics, Oregon State University
M. Edward Rister
Affiliation:
Department of Agricultural Economics, Texas A & M University
James W. Richardson
Affiliation:
Department of Agricultural Economics, Texas A & M University
David A. Bessler
Affiliation:
Department of Agricultural Economics, Texas A & M University
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Abstract

E-V studies traditionally have relied on historical data to calculate returns and variance. Historical data may not fully reflect current conditions, particularly when decisions involve government-supported crops. This paper presents a method for calculating mean and variance using subjectively-estimated data. The method is developed for both government-supported and non-program crops. Comparisons to alternative methods suggest the approach provides reasonable accuracy.

Keywords

government farm programmean-variancesimulationsubjective
Type
Submitted Articles
Information
Journal of Agricultural and Applied Economics , Volume 21 , Issue 2 , December 1989 , pp. 95 - 105
Copyright
Copyright © Southern Agricultural Economics Association 1989

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