The name is absent

Many studies have been conducted so far to examine farmer’s production behavior under
uncertainty and recently the approach called “joint analysis of risk preference structure and
technology” has been employed to directly estimate structural parameters that indicate agent
risk preference and production technology (Love and Buccola 1991; Saha, Shumway, and
Talpaz. 1994; Chavas and Holt 1996; Saha 1997; Abdulkadri, Langemeier and Featherstone
2003; Nakashima 2006). In order to develop joint analysis models, the two distinctive
decision-making criteria, expected utility (EU) theory and mean-standard deviation (MS)
approach, have been particularly adopted. Needless to say, EU theory ranks random payoffs
in accordance with expected value of suitably chosen utility function over payoff and MS
approach evaluates random payoffs utilizing the objective function defined over the mean
and standard deviation of payoff. The popularity of EU theory is in its axiomatic
fundamentals (von Neumann and Morgenstern 1944) and analytical tools such as measures
of risk aversion (Arrow 1974; Pratt 1964), while that of MS approach is in its simple and
intuitively understandable framework (Markowitz 1952; Tobin 1958). Attention has been
paid to the MS approach since Sinn (1983) and Meyer (1987) discovered that EU theory
derives MS approach if random payoffs are restricted to the distribution class satisfying the
location and scale parameter (LS) condition. Besides, they successfully translated under the
LS condition the EU-based-behavioral hypothesis such as von Neumann-Morgenstern
(vNM) utility function’s curvature and Arrow-Pratt measure of risk aversion into appropriate
analogues of the MS approach. They also pointed out that the LS condition is actually
satisfied in a wide range of EU-based economic models since the random payoffs they
analyzed is formulated as a linear function of random factor that is uniquely involved in their
models (Feder, 1977).¹ For example, portfolio theory (Fishburn and Porter 1976), saving
theory (Sandmo 1970), insurance demand theory (Ehrlich and Becker 1972), and production
theory under uncertainty (Sandmo 1971; Ishii 1977; Feder 1980; Feder, Just, and Schmitz

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