Insecticide Use and Crop Rotation under Risk: Rootworm Control in Corn
1983
Lazarus, William F. | Swanson, Earl R.
The economic threshold concept is extended to a combination of two pest controls, insecticide and crop rotation, in a corn‐soybean farm model. Effect of risk attitudes on the optimal combination of controls is explored, using a stochastic simulation with random crop prices, yields, and rootworn damage. Crop insurance may cause a risk‐averse farmer to adopt a riskier cropping program. Reduced risk aversion causes the farmer to specialize in the more profitable corn crop. The insecticide and rotation thresholds both increase with reduced risk aversion. Depending on pest densities on individual fields, insecticide use may increase or decrease.
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