Analysis of Farmers’ Stated Risk and Their Perceptions Towards Climate Change in the Northwest of Mexico

Risk attitudes are relevant factors affecting the production and investment decisions at farm level. They are key factors that are related to farmers’ attitudes towards environment and climate change. Several methodological approaches are available to measure the level of stated risk of an economic agent. The Multiple Price List (MPL) method is one of the methods that is gaining relevance. In this study we apply the MPL and relate the risk outcomes with farmers’ characteristics and their perception towards environment and climate change. Data was collected using a face to face survey carried out for a group of 370 agricultural producers of the irrigation district located in northwest of Mexico. Results showed an average risk of about 0.32, locating the agricultural producers of the region in a group with risk aversion, according to the MPL scale. The heterogeneity analysis showed that the socioeconomic factors and the perceptions towards climate change are related to the farmers´ stated risk level. Farmers who are young women with propensity to use public support to invest were shown to be greater risk lovers. Farmers in the region have perceived climate change to a greater extent like floods, hail, diseases and pests, and changing vegetation.