COST-FUNCTIONS UNDER PRODUCTION UNCERTAINTY

Authors
POPE RD CHAVAS JP
Citation
Rd. Pope et Jp. Chavas, COST-FUNCTIONS UNDER PRODUCTION UNCERTAINTY, American journal of agricultural economics, 76(2), 1994, pp. 196-204
Citations number
38
Categorie Soggetti
Economics,"AgricultureEconomics & Policy
Journal title
American journal of agricultural economics → ACNP
ISSN journal
00029092
Volume
76
Issue
2
Year of publication
1994
Pages
196 - 204
Database
ISI
SICI code
0002-9092(1994)76:2<196:CUPU>2.0.ZU;2-7
Abstract
We characterize the cost functions which would be consistent with expe cted utility maximization when production is uncertain. It is not gene rally possible, assuming risk aversion, to use only expected output as the constraint in a cost minimization problem. In some leading cases, cost functions consistent with expected utility maximization are part icularly useful because they are devoid of risk preferences.