The empirical analysis in this paper shows that production risk plays a significant role in sustainable land-management technology adoption in the Ethiopian highlands.
The adoption and intensity decreased for farmers who experienced higher variance of return and downside risk exposure (skewness), and increased for farmers who experienced higher expected return. These findings could help decisionmakers design economic instruments that can hedge against variability of return (as measured by variance) and crop failure, and increase expected return to promote sustainable land-management technologies.
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