Optimal Debt and Risk Balancing Behavior of Rural Households in China: Evidence from a Discrete Choice Experiment

References

• China Banking Regulatory Commission. 2012. Rural household loan management method. Accessed March 24, 2020. http://www.gov.cn/gongbao/content/2012/content_2283045.htm
   Google Scholar
• Collins, R. A. 1985. Expected utility, debt-equity structure, and risk balancing. American Journal of Agricultural Economics 67:627–29. doi:10.2307/1241085.
   Web of Science ®Google Scholar
• de Bekker-Grob, E. W., B. Donkers, M. F. Jonker, and E. A. Stolk. 2015. Sample size requirements for discrete-choice experiments in healthcare: A practical guide. Patient 8:373–84. doi:10.1007/s40271-015-0118-z.
   PubMedGoogle Scholar
• de Mey, Y., F. van Winsen, E. Wauters, M. Vancauteren, L. Lauwers, and S. Van Passel. 2014. Farm-level evidence on risk balancing behavior in the EU-15. Agricultural Finance Review 74 (1):17–37. doi:10.1108/AFR-11-2012-0066.
   Google Scholar
• de Mey, Y., E. Wauters, D. Schmid, M. Lips, M. Vancauteren, and S. Van Passel. 2016. Farm household risk balancing: Empirical evidence from Switzerland. European Review of Agricultural Economics 43 (4):637–62. doi:10.1093/erae/jbv030.
   Web of Science ®Google Scholar
• Escalante, C. L., and P. J. Barry. 2003. Determinants of the strength of strategic adjustments in farm capital structure. Journal of Agricultural and Applied Economics 35 (1):67–78. doi:10.1017/S1074070800005940.
   Google Scholar
• Featherstone, A. M., C. B. Moss, T. G. Baker, and P. V. Preckel. 1988. The theoretical effects of farm policies on optimal leverage and the probability of equity losses. American Journal of Agricultural Economics 70 (3):572–79. doi:10.2307/1241495.
   Web of Science ®Google Scholar
• Freund, R. J. 1956. The introduction of risk into a programming model. Econometrica 24 (3):253–63. doi:10.2307/1911630.
   Web of Science ®Google Scholar
• Gabriel, S. C., and C. B. Baker. 1980. Concepts of business and financial risk. American Journal of Agricultural Economics 62 (3):560–64. doi:10.2307/1240215.
   Web of Science ®Google Scholar
• Gloy, B. A., and T. G. Baker. 2002. The importance of financial leverage and risk aversion in risk-management strategy selection. American Journal of Agricultural Economics 84 (4):1130–43. doi:10.1111/1467-8276.00373.
   Web of Science ®Google Scholar
• Gu, W. H., and Y. M. Sun. 2015. Great transformation: Innovation and development of Chinese farms. ON: Xinhua Publishing House.
   Google Scholar
• Huang, J. 2018. Facilitating inclusive rural transformation in the Asian developing countries. World Food Policy 4 (2):31–55. doi:10.18278/wfp.4.2.4.
   Google Scholar
• Ifft, J. E., T. Kuethe, and M. Morehart. 2015. Does federal crop insurance lead to higher farm debt use? Evidence from the Agricultural Resource Management Survey (ARMS). Agricultural Finance Review 75 (3):349–67. doi:10.1108/AFR-06-2014-0017.
   Google Scholar
• International Fund for Agricultural Development. 2016. Rural development: Report 2016: Fostering inclusive rural transformation. IFAD.
   Google Scholar
• Johnson, R., and B. Orme. 2003. Getting the most from CBC. Sawtooth Software Research Paper Series, Sequim: Sawtooth Software.
   Google Scholar
• Liu, T., G. He, and C. G. Turvey. 2019. Inclusive finance, farm household’s entrepreneurship, and inclusive rural transformation in rural poverty-stricken areas in China. Emerging Markets Finance and Trade 1–30.
   Google Scholar
• Mangham, L. J., K. Hanson, and B. McPake. 2009. How to do (or not to do): Designing a discrete choice experiment for application in a low-income country. Health Policy and Planning 24 (2):151–58. doi:10.1093/heapol/czn047.
   PubMed Web of Science ®Google Scholar
• Maurer, K. 2014. Where is the risk? Is agricultural banking more difficult than other sectors? In Finance for food: Towards new agricultural and rural finance, ed. D. Köhn, 139–65. London: Springer. doi:10.1007/978-3-642-54034-9_7.
   Google Scholar
• McFadden, D. 1974. Conditional logit analysis of qualitative choice behavior. In Frontiers in econometrics, ed. P. Zarembka, 105–42. New York: Academic Press.
   Google Scholar
• McFadden, D., and K. Train. 2000. Mixed MNL models for discrete response. Journal of Applied Econometrics 15 (5):447–70. doi:10.1002/1099-1255(200009/10)15.
   Web of Science ®Google Scholar
• Mohamad, W. N., K. Willis, and N. Powe. 2020. The status quo in discrete choice experiments: Is it relevant? The Singapore Economic Review 65 (2):507–32. doi:10.1142/S0217590819500036.
   Web of Science ®Google Scholar
• Peng, P., and L. Zhou. 2020. Reforming land mortgages in rural China and the incentives for application of environment-friendly formula fertilizers on farm. Agricultural Finance Review 81 (5):617–35. doi:10.1108/AFR-03-2019-0026.
   Web of Science ®Google Scholar
• Peng, Y., and R. Kong. 2020. An analysis of China’s reforms on mortgaging and transacting rural land use rights and entrepreneurial activity. Agricultural Finance Review 80 (3):377–400. doi:10.1108/AFR-08-2019-0094.
   Web of Science ®Google Scholar
• Robison, L. J., and P. J. Barry. 1987. The competitive firm’s response to risk. New York: Macmillan Publishing Cooperation. doi:10.2307/1242217.
   Google Scholar
• Shee, A., C. G. Turvey, and A. Marr. 2021. Heterogeneous Demand and Supply for an Insurance‐linked Credit Product in Kenya: A Stated Choice Experiment Approach. Journal of Agricultural Economics 72 (1):244–67. doi:10.1111/1477-9552.12401.
   Web of Science ®Google Scholar
• Tamirat, A. A., A. A. Trujillo-Barrera, and J. M. Pennings. 2018. Farm level risk balancing behavior and the role of latent heterogeneity. Journal of Agricultural and Resource Economics. doi:10.22004/ag.econ.302454.
   Web of Science ®Google Scholar
• Turvey, C. G., and T. G. Baker. 1989. Optimal hedging under alternative capital structures and risk aversion. Canadian Journal of Agricultural Economics 37 (1):135–43. 1989.tb03341. x. doi:10.1111/j.1744-7976.
   Google Scholar
• Turvey, C. G., and T. G. Baker. 1990. A farm-level financial analysis of farmers’ use of futures and options under alternative farm programs. American Journal of Agricultural Economics 72 (4):946–57. doi:10.2307/1242626.
   Web of Science ®Google Scholar
• Turvey, C. G., and R. Kong. 2009. Business and financial risks of small farm households in China. China Agricultural Economic Review 1 (2):155–72. doi:10.1108/17561370910927417.
   Web of Science ®Google Scholar
• Turvey, C. G., G. He, M. Jiujie, R. Kong, and P. Meagher. 2012. Farm credit and credit demand elasticities in Shaanxi and Gansu. China Economic Review 23 (4):1020–35. doi:10.1016/j.chieco.2012.05.004.
   Web of Science ®Google Scholar
• Turvey, C. G., V. L. Bogan, and C. Yu. 2012. Small businesses and risk contingent credit. Journal of Risk Finance 13 (5):491–506. doi:10.1108/15265941211273777.
   Google Scholar
• Uzea, F., K. Poon, D. Sparling, and A. Weersink. 2014. Farm support payments and risk balancing: Implications for financial riskiness of Canadian farms. Canadian Journal of Agricultural Economics/Revue Canadienne Agroeconomic 62 (4):595–618. doi:10.1111/cjag.12043.
   Web of Science ®Google Scholar
• Veldwijk, J., M. S. Lambooij, E. W. de Bekker-Grob, H. A. Smit, G. A. de Wit, and D. W. Cameron. 2014. The effect of including an opt-out option in discrete choice experiments. PloS One 9 (11):e111805. doi:10.1371/journal.pone.0111805.
   PubMed Web of Science ®Google Scholar
• Verteramo Chiu, L., V. Khantachavana, and C. G. Turvey. 2014. Risk rationing and the demand for agricultural credit: A comparative investigation of Mexico and China. Agricultural Finance Review 74 (2):248–70. doi:10.1108/AFR-05-2014-0011.
   Google Scholar