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 greatest. When a new technology or crop is introduced it affects the first two

 variabilities most significantly.

 The risk and uncertainties associated with these variabilities are the normal

 decision-making and operational environment for agriculture generally. In the

 case of subsistence and semi-subsistence agriculture, however, these variabilities

 combine with low levels of income (output) or "subsistence" levels and standards

 of living to produce a much stronger "survival" element in decision-making.

 "Even though the average annual yield of the new factor is substan-
 tially higher than that of the old factor which it replaces, it may vary 1/
 much more from year to year because of weather, insects, and other pests.
 Moreover, the true yield variability of the new factors from these sources
 will not be known, while that of the old factor is well known from ex-
 perience over many decades. Thus there would be inherent in the prospec-
 tive yield of the new factors these new elements of risk and uncertainty.
 They must be taken into account, too, in determining profitability,
 especially so since farmers in a poor community are less able, in terms
 of reserves and experience, to cope with such additional risk and un-
 certainty than are farmers in high income countries." [Schultz, 1964,
 p. 1671.

 Compared with commercial agriculture, subsistence agriculture has a stronger

X// "risk aversion" and "security preference." This fact results in economic choices

 and institutions to reduce risk and to increase security ranging from the selection

 of drought resistant varieties [Myren, 1964, p. 971 to reliance upon the extended

 family (Wolf, 1966, p. 67] or upon the village [Georgescu-Roegen, 1969] to provide

 food/job insurance.

 In the present instance we would like to explore further the exact nature of

 this interaction between risk and subsistence living so characteristic of peasant

 farming.




 1/
 dnate [1967] has some interesting empirical evidence of increased variance
 to be observed with higher yielding varieties of rice compared with the tradi-
 tional.