Supply Responsiveness of Rice Under Risk in Jambi Province

Abstract

Farmers’ supply responsiveness planting of rice in Jambi Province was estimated using Land Acreage analysis function. The objective of study is to analyze rice farmers’ supply response under risk. The first, the lagged production function was postulated for empirical estimation of expectation variables. The estimated parameters showed that risk variables played an important role for farmers in making decisions. The result also showed that farmers are risk averse. Therefore, government policies have to consider risk management, and dynamic considerations. Finally, in order to evaluate the effectiveness of this policy especially in government farm program, the risk variables will again give an effect and impact on final result..

Keywords : supply response of rice, Land Acreage function, and risk