Changes in Polish Farmers’ Attitudes Toward Risk After Poland’s Accession to the EU

ABSTRACT

This article presents the econometric estimation of the risk attitudes of Polish farmers. For that purpose, a model of production under risk has been employed. The research is based on data from the Polish Farm Accountancy Data Network (FADN), from the years 2004–2010. For the Polish farming sector, risk-related considerations became increasingly important after Poland’s EU accession in 2004. After the accession, Polish agriculture was affected by market liberalization, which was somewhat mitigated by CAP support. To examine the risk aversion of Polish farmers, an estimation procedure based on Antle’s (1987) approach has been applied. This study suggests that, as was the case in other countries, risk aversion decreased following EU accession, that is, the Arrow-Pratt measure of absolute risk aversion based on producers specializing in field crops systematically decreased over the analyzed period.

KEYWORDS:

• Common agricultural policy
• econometric estimation
• Poland
• risk preferences

Notes

¹ According to Eurostat, “factors income” is the net value added enlarged by the value of other production subsidies minus other production taxes.

²