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Farmer Decision‐Making with Conflicting Goals: A Recursive Strategic Programming Analysis
Author(s) -
Wallace Michael T.,
Moss Joan E.
Publication year - 2002
Publication title -
journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.157
H-Index - 61
eISSN - 1477-9552
pISSN - 0021-857X
DOI - 10.1111/j.1477-9552.2002.tb00007.x
Subject(s) - profitability index , profit (economics) , cash flow , investment (military) , consumption (sociology) , time horizon , economics , microeconomics , investment decisions , business , econometrics , operations research , production (economics) , finance , mathematics , social science , sociology , politics , political science , law
This paper concerns the analysis of farmers' goal trade‐offs using a series of representative dairying and beef/sheep farm models. The models employ an adaptive feedback structure and expectations model to track adjustment processes over a seven‐year planning horizon, 1991/92 to 1997/98. Model solutions, under a conventional profit maximising objective function, and using a weighted goal programming formulation, under a series of empirically specified alternative goal orientations, are examined and compared. The paper identifies significant variation among farm families in terms of ability to attain key goals concerning farm profitability, family consumption, farm investment, growth and cash flow. The results quantify the trade‐off between family consumption and farm investment/growth goals.