Supply responsiveness of potatoes under risk in Jambi Province

Abstract

The supply responsiveness of potatoes under risk in Jambi province is evaluated by applying an analysis of the lagged acreage function. The characteristics of crop production can explain sustainable decision-making allocations between realized inputs and outputs, taking time lags into account. The objective of the study is to analyze the supply responsiveness of potatoes under risk. Firstly, a production function in lag is estimated from empirically expected variables. Evaluating parameters found that risky variables explained the crucial role of farmers' strategies in decision-making. The findings explain that potato farmers appear to be risk-averse. Hence, the point of government policies has to take a look at risk management, and also the dynamic point of view. In the end, to test the effectual or not of government policy such as the potato farming program, risky variables are going to explain the effect and also impact the latter result. For example, minimizing the effect of the risk variable will increase the acreage, which implies a shift in the supply curve.