Table 1. Gross Revenue Less Variable Costs in Dollars per Acre for Oranges in Three Harvest Periods,
Strawberries ,and Grapefruit, 1973 through 1987
Oranges
|
______Year_____ |
Decembera |
February |
________April________ |
Strawberries |
Grapefruit |
|
1973 |
259.90 |
468.21 |
387.25 |
2,868.30 |
1,269.54 |
|
1974 |
326.39 |
512.99 |
256.82 |
83.40 |
780.93 |
|
1975 |
192.46 |
235.57 |
250.74 |
2,913.20 |
627.76 |
|
1976 |
421.77 |
683.32 |
619.85 |
733.40 |
386.33 |
|
1977 |
-90.58 |
-149.62 |
222.32 |
-615.10 |
553.33 |
|
1978 |
1,198.82 |
1,518.40 |
1,317.43 |
2,809.90 |
397.25 |
|
1979 |
1,282.93 |
1,832.44 |
1,309.49 |
3,107.30 |
831.65 |
|
1980 |
1,354.17 |
1,562.99 |
1,092.69 |
4,457.80 |
1,350.73 |
|
1981 |
756.30 |
1,064.82 |
819.27 |
-279.80 |
1,185.12 |
|
1982 |
749.51 |
754.22 |
387.40 |
1,149.80 |
231.03 |
|
1983 |
791.69 |
814.40 |
1,099.59 |
-255.60 |
-155.55 |
|
1984 |
486.82 |
1,022.50 |
664.39 |
-3,079.70 |
146.70 |
|
1985 |
1,731.98 |
1,417.93 |
1,130.23 |
971.30 |
662.12 |
|
1986 |
711.21 |
841.22 |
668.53 |
-815.70 |
1,065.17 |
|
1987 |
708.64 |
1,124.19 |
902.59 |
2,441.10 |
1,577.37 |
|
Mean |
725.47 |
913.57 |
741.91 |
1,099.31 |
727.30 |
|
Standard |
494.60 |
535.04 |
388.33 |
1,990.17 |
491.01 |
Deviation
a December of the previous year.
Table 2. Correlation Coefficients of Returns for Oranges in Three Harvest Periods , Strawberries, and
Grapefruit, 1973thorugh 1987
Oranges
|
December |
February |
April |
Strawberries |
Grapefruit | |
|
Oranges | |||||
|
December |
1.000 | ||||
|
February |
.903* |
1.000 | |||
|
April |
.861* |
.902* |
1.000 | ||
|
Strawberries |
.356 |
.347 |
.299 |
1.000 | |
|
Grapefruit________ |
,093________ |
.180 |
.029 |
________,464________ |
1.000 |
* Significantly different from zero at the 5 percent level of significance.
194
risk aversion coefficient were profit maximizers.
Farmers with a risk aversion coefficient of0.000005
were slightly risk averse. Producers with a risk aver-
sion coefficient of 0.00001 or 0.00002 were
moderately risk averse, while producers with a coef-
ficient of 0.00005 or 0.0001 were strongly risk
averse. The risk aversion levels were chosen based
on Raskin and Cochran and on the certainty
equivalent. When the certainty equivalent drops
below the lowest observed outcome, the risk aver-
sion coefficient is likely t∞ high. The most risk
averse coefficient examined (0.0001) was the only
one in which the certainty equivalent was less than
the lowest outcome, suggesting this as an upper limit
on risk aversion.
The base scenario results are presented in the top
block of Table 3. The base scenario provides the
orange producer with the optimal plan for the current
150 acres. For the producer with risk aversion coef-
ficients less than or equal to .00001, midseason
(February) maturing oranges should have been
raised on the 150 acres. Farmers with a risk aversion
coefficient of 0.00002 should have raised both mid-
season oranges and Valencia (April) oranges.