Decision-making criteria under uncertainty and risk in the agricultural sector
DOI:
https://doi.org/10.51599/is.2023.07.04.06Keywords:
agricultural sector, decision making criteria, uncertainty, risk, payoff matrix, risk management.Abstract
Purpose. The objective of this research is to find out and analyze the standards that farmers, policymakers, and other significant stakeholders in the agriculture sector use to make decisions under conditions of risk and uncertainty. Our objective is to contribute to the body of knowledge in agricultural economics by critically examining these standards and offering comprehensive analysis that can contribute to more adaptable and resilient decision-making.
Results. The importance of decision-making in light of risk and uncertainty was clearly emphasized to predict and illustrate the understanding of the variables that affect decision-making in the agricultural industry. Important patterns, trends and variables that have a significant impact on decision outcomes were detected by combining quantitative analysis with qualitative assessments. With several alternatives, internal and external conditions and many possibilities, criteria that help make the right decision, maximize return or minimize the cost of risk and uncertainty were highlighted for stakeholders seeking to improve decision-making processes and adaptability to changing obstacles, while trying to abandon the scientific basis in modeling the reality of the agricultural sector.
Scientific novelty. This study advances the subject by providing a wide and relatively new perspective on the criteria that used in agricultural decision-making in the face of uncertainty and risk. Although decision-making in agricultural situations has been studied in the literature before, our study is distinguished by its focus on the criteria that are used when there is uncertainty and risk. We hope to shed light on new ideas that can improve agricultural economics theory and methods by exploring this area.
Practical value. The study has a wide range of practical applications. A more detailed understanding of the decision-making factors found in this study will be useful for farmers, legislators, and agribusiness experts. Given an ever-changing environment, simulate realistic obstacles and identify available alternatives under various conditions, the ultimate practical value of more resilient and sustainable agricultural practices is enhanced through risk management measures, resource allocation and policy formulation.
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