Market Strategies Outperform Government Policies in Reducing Farmers' Risks
The study looked at how different policies can help farmers reduce risks and improve their well-being. By using a model and simulations, the researchers found that policies that address both price and yield variability can work well together. Payments that encourage farmers to use their land can help reduce risk, but they may also affect other market strategies. Overall, market mechanisms seem to be more effective in reducing farmers' risks. The best policy mix depends on what the government wants to achieve, and there may be a trade-off between reducing risk and improving farmers' welfare.