Oa. Ramirez et E. Somarriba, Risk and returns of diversified cropping systems under nonnormal cross-, and autocorrelated commodity price structures, J AGR RESOU, 25(2), 2000, pp. 653-668
This study analyzes the risks of diversified tropical cropping systems that
combine cocoa, plantain, and tree-crop components in different proportions
versus traditional monocultures. A technique for modeling the expected val
ues, variances, and covariances of correlated time-series variables that ar
e autocorrelated and nonnormal (right or left skewed and kurtotic) is appli
ed to simulate commodity prices. The importance of using simulated cumulati
ve density functions (cdf's) which reflect the most important characteristi
cs of the stochastic behavior of prices for analyzing risk and returns of d
iversified agricultural systems is demonstrated. The analysis provides evid
ence in favor of diversified cocoa-plantain-Cordia agroforestry system tech
nologies versus the traditional monocultures.