Economics of African Animal Trypanosomosis (AAT) management strategies under risk and time preferences

• Applicant: Professor Dr. Hermann Waibel
• Subject Area: Agricultural Economics, Agricultural Policy, Agricultural Sociology
• Term: from 2011 to 2015
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 209505678

• Final Report Year: 2015

Final Report Abstract

In our project, we firstly examined risk and time preference of West African cattle farmers and compared them to empirical evidence from Asia. The first key finding is that West African cattle farmers have different behavioral attitudes towards risk and time than similarly situated respondents from Asia. We found that West African cattle farmers are on the one hand more risk averse than Asian farmers, but on the other hand more patient. The differences show that individual attitudes are strongly associated with the risky and temporal aspects of the major livelihood strategy. The livelihood strategy of traditional cattle keeping in West Africa is a long term, low return, but relatively certain investment activity. This finding suggests that development interventions should consider cultural and socio-economic characteristics of the target population, because these observable factors are closely associated with unobservable behavioral factors that determine the success of adoption and in the end the success of the intervention. Furthermore, we investigated the optimal treatment strategy of African animal trypanosomosis in cattle given the risk of drug resistance development through drug misuse. The second key finding of our project is that the disease management of a riskaverse and patient farmer is not efficient. The adoption of the optimal strategy would avoid losses of approximately 5% of farmer’s annual income. In addition, if the same farmer would be less risk-averse, he could reduce losses by US$130 per year. The results call for incentives that induce farmers to improve current risk management. For example, livestock field schools may reduce disease management failures and livestock insurances may lead to a reduction in farmers risk aversion, thereby increasing the efficiency of the management process.

Publications

• 2011. Attitudes towards risk and time among small-scale farmers in West Africa. Paper presented at the PEGNet Conference 2011, September 07-09, Hamburg, Germany
  Liebenehm, S. and H. Waibel
  
• 2012. How risk-averse are small-scale cattle farmers in West Africa? - First insights from an experimental study in West Africa using panel data. Jahrestagung 2012 "Development Economics and Policy" of Ausschuss für Entwicklungsländer (AEL) of Verein für Socialpolitik. June 22-23, Bonn, Germany
  Liebenehm, S. and H. Waibel
  
• (2014). Risk and Time Preferences of West African Cattle Farmers. Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V., Bd. 49, 2014: 15-26
  Liebenehm, S. and H. Waibel
  
• Simultaneous Estimation of Risk and Time Preferences among Small-Scale Cattle Farmers in West Africa. American Journal of Agricultural Economics, Volume 96, Issue 5, 1 October 2014, Pages 1420–1438
  Liebenehm, S and H. Waibel
  
• Optimal Drug Control under Risk of Drug Resistance – the Case of African Animal Trypanosomosis. Journal of Agricultural Economics, Vol 67 Issue 2, June 2016, Pages 510-533
  Liebenehm, S., B. Bett, C. Verdugo and M. Said