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In recent years, risk analysis and risk management have come to the fore of agricultural research and driven policy discussions regarding European agriculture. Indeed, numerous changes in the agricultural production chain such as increased globalization and liberalization, climatic changes and a growing awareness for environmental and animal welfare have made several types of risk increasingly important. A good understanding of farmers' risk behavior is essential in order to be able to predict sectorial responses to these changes in risk conditions and to anticipate the outcome of risk-related policies. Risk balancing behavior constitutes one potential unanticipated risk response as it involves making strategic financial risk adjustments in response to changes in business risk levels. European evidence on risk balancing behavior, however, was lacking to date leaving EU-policy makers partly in the dark with regards to the full impact of risk-altering policy measures of the CAP—i.e., the existing decoupled income support and future risk management instruments currently considered in CAP reform discussions. Another area that is gaining increased attention in European agricultural risk analysis is the importance of farm household risk exposure and management. Given that farmers have a broad range of family-related goals and values and that EU farm households increasingly earn a large part of their household income from non-agricultural sources, agricultural risk behavior could be better understood by also considering risk exposure and risk constraints at the household level. Therefore, the possibility of the simultaneous adoption and potential correlation between different on-farm and off-farm responses needs to be acknowledged when looking at risk balancing behavior. The central research objective of this PhD dissertation is therefore to examine risk balancing behavior in European agriculture and acknowledging the role of the farm household. ; De laatste jaren kwam risico in de landbouw meer dan ooit in beeld: veranderende teeltomstandigheden door klimaatsveranderingen, schommelende prijzen door geglobaliseerde markten en de onzekerheid omtrent de stelselmatige hervormingen van het Europese gemeenschappelijk landbouwbeleid (GLB). Het analyseren en beheren van deze risico's heeft de laatste jaren bijgevolg ook meer aandacht gekregen in het landbouweconomisch onderzoek en in beleidsdiscussies rond de Europese landbouw. Het is namelijk van belang voor EU beleidsmakers om de sectorale reactie op dit veranderende risicoklimaat en de potentiële impact van risico-gerelateerde beleidsinstrumenten juist in te kunnen schatten. In de landbouweconomische literatuur wordt 'risico balancerend' gedrag beschreven als een onverwachte reactie op een veranderend risicoklimaat, wat een juiste inschatting kan bemoeilijken. De theorie stelt dat landbouwers strategische veranderingen maken in hun schuldenstructuur als reactie op veranderingen in de graad van operationeel risico. Landbouwers balanceren zo als het ware hun operationeel en financieel risico opdat het totale bedrijfsrisico constant zou blijven. Europese studies rond risico balancerend gedrag bestaan echter niet, waardoor de volledige impact van risico-gerelateerde beleidsmaatregelen van het GLB (bv. ontkoppelde inkomenssteun of gesubsidieerde risicobeheersingsinstrumenten) niet gekend is. Een ander aspect dat meer en meer belicht wordt in de Europese landbouweconomische literatuur is de rol van het landbouwgezin in het beheersen van de risico's van het landbouwbedrijf. Steeds vaker verdienen Europese landbouwgezinnen een aanzienlijk deel van hun gezinsinkomen via niet-landbouw kanalen. Gezien de nauwe band tussen het landbouwbedrijf en –gezin nemen landbouwers naast bedrijfsgerichte doelen (bv. het maximaliseren van winst) ook gezinsaspecten in overweging bij het nemen van risicovolle beslissingen. Bijgevolg kan het nemen van risicovolle beslissingen door landbouwers beter begrepen worden indien zowel bedrijfsgerichte als gezinsstrategieën bekeken worden. Gegeven bovenstaande bevindingen is de centrale onderzoeksvraag van dit doctoraatsproefschrift het analyseren van risico balancerend gedrag bij Europese landbouwers en daarbij expliciet de rol van het landbouwgezin te erkennen.

Traditionally, agricultural economists employ farm level modeling for a variety of purposes. Central to these modeling techniques is the behavioral assumption of farm profit maximization, or, when risk preferences are put into play (risk aversion), utility maximization. However, there is abundant literature, from different (sub)disciplines such as farming systems research, rural sociology, rural development and rural economic geography that views farm household activities in the wider economic context (e.g. Gasson et al., 1988, Dries et al., 2011, Bessant, 2006). In such view, farm households are considered pluriactive and may distribute assets between agricultural and non-agricultural purposes to accomplish their goals. Hence, according to this view, a more realistic behavioral assumption than profit maximization at the farm level would be the optimization of farm household risk (i.e. the chance of falling below a certain threshold level of household cash flow). Focusing on farm household level risk is a natural transition from farm-level risk analysis since the largest proportion of farms in the EU are family farms and many farmers already implement risk management strategies at the household level. Although the income maximization assumption is being contested in literature (e.g. Freshwater and Jette-Nantel, 2011) and more concern is being given about the welfare and well-being of households instead of focusing on the level of income (e.g. Boisvert, 2002), to the best of our knowledge, it is very uncommon in the agricultural economics literature on risk analysis to include a measure of household risk or consider the household as the entity of interest. This paper develops a farm household simulation model that describes the potential implications of considering the optimizing of farm household level risk as a behavioral response. It starts from conceptual descriptions of operational -, financial -, farm - and farm household risk. It then models the behavior of a typical dairy farm household as one optimizing farm household risk and derives the implications of alternative risk management strategies. ; IWT

To achieve its objectives in a changing world, the Common Agricultural Policy needs to put the resilience of Europe's farming systems at its center. The current CAP focuses on making the farming community more robust against shocks in the short run. However, a broader view on resilience is needed to ensure a sustainable agricultural sector in the longer term. This new vision should pay sufficient attention to developing the capacities of both individual farms and farming systems to adapt to changing circumstances and to transform their business models where necessary to maintain the delivery of food, fiber, energy and public goods in the long run. ; EU; en; contact: miranda.meuwissen@wur.nl

Multiple economic, ecological, institutional and societal challenges raise concern about the future functionality of agriculture and more specifically of farms in Europe, which leads to an increased need to understand and improve its resilience. We aim to provide a comprehensive overview of farmers' perception and self-assessment of resilience that would serve as a solid basis for further research on farm resilience. In order to achieve the aim, a farmer survey was designed based on theories of risk communication, decision theory and psychometric models. We conducted the survey in 11 case study regions across the European Union. No previous empirical research on farm resilience included so many diverse case studies. ; EU; en; contact: alisa.spiegel@wur.nl

Risk and risk management are essential elements of agriculture and affect the wellbeing of farm households. Farmers react to production, market and institutional risks and challenges by taking measures on or off the farm. Such risk management measures are often costly and have implications for up- and downstream industries as well as the environment. The risk exposure of European farms is increasing. For example, climate change will increase the frequency and magnitude of extreme weather events like droughts, heatwaves and heavy rainfalls that potentially have detrimental effects on agricultural production. Thus, the adaptive capacity and risk management options in European agriculture need to be improved. Policy shall support this process. Policies are needed to support a diversity of risk management solutions and not only focus on a few solutions. Strategies to cope with risk often go beyond the level of the individual farm. Cooperation, learning and sharing of risks play a vital role in European agriculture and shall be strengthened. Thus, coordinated policies targeting beyond the individual farm and considering all the stakeholders involved in the risk management strategies are needed to ensure their effective implementation. Moreover, policies need to facilitate to take full advantage of the rapid technological progress and improved data availability (e.g. based on satellite imagery) to develop a wider set of risk management strategies. ; EU; en; contact: miranda.meuwissen@wur.nl

CONTEXT The ability of a farm to cope with challenges is often conceptualised as resilience. Although improving resilience of farms is a major policy goal in the European Union, the current state of resilience is often unknown. Previous resilience assessments have been based either on pre-defined indicators or on perceptions. In particular, empirical research of perceived resilience is still limited and usually restricted to one specific resilience capacity, one challenge, or one function. OBJECTIVE We investigate how European farmers perceive resilience capacities of their farms. Extending beyond previous research, we cover all three resilience capacities (robustness, adaptability, and transformability), consider a broad range of short-term shocks and long-term stresses, and include multiple functions. Furthermore, we analyse farms from diverse farming systems across Europe and investigate whether farms and farmers with similar perceived resilience capacities share characteristics. METHODS We address the complex nature of resilience capacities by accounting for multiple scales formulated as analytical steps of a resilience assessment framework. More specifically, these are 'resilience of what' (farms and farming systems), 'resilience to what' (challenges), 'resilience for what purpose' (functions), and 'what enhances resilience' (resilience attributes). These steps guided the development of a survey with farmers across eleven European farming systems. Based on three indices for each farmer indicating perceived robustness, adaptability, and transformability of their farms, we identified two classes of farmers with particularly strong and weak resilience profiles respectively. Using nonparametric Mann-Whitney U tests, we furthermore compared other parameters collected via the survey across the identified classes. RESULTS AND CONCLUSIONS Our data sample outputs two classes of similar size characterised by all three perceived resilience capacities being above (below) regional average. This finding suggests that the perceptions of robustness, adaptability, and transformability are mutually dependent. Furthermore, we found that farmers who perceive their resilience above the regional averages are characterised by lower risk aversion, greater focus on providing public goods, a higher number of implemented risk management strategies, more active involvement in networks, and greater openness to innovation. SIGNIFICANCE The revealed links between particular characteristics of farms and farmers and different levels of perceived resilience capacities can support policy-makers in developing more targeted resilience-enhancing strategies, as well as in understanding farmers' responses to challenges. Finally, our results can serve as a basis for further research, e.g., for formulating and testing hypotheses on causal effects between perceived resilience and its components, and on links between perception- and indicator-based resilience assessments.

CONTEXT The ability of a farm to cope with challenges is often conceptualised as resilience. Although improving resilience of farms is a major policy goal in the European Union, the current state of resilience is often unknown. Previous resilience assessments have been based either on pre-defined indicators or on perceptions. In particular, empirical research of perceived resilience is still limited and usually restricted to one specific resilience capacity, one challenge, or one function. OBJECTIVE We investigate how European farmers perceive resilience capacities of their farms. Extending beyond previous research, we cover all three resilience capacities (robustness, adaptability, and transformability), consider a broad range of short-term shocks and long-term stresses, and include multiple functions. Furthermore, we analyse farms from diverse farming systems across Europe and investigate whether farms and farmers with similar perceived resilience capacities share characteristics. METHODS We address the complex nature of resilience capacities by accounting for multiple scales formulated as analytical steps of a resilience assessment framework. More specifically, these are 'resilience of what' (farms and farming systems), 'resilience to what' (challenges), 'resilience for what purpose' (functions), and 'what enhances resilience' (resilience attributes). These steps guided the development of a survey with farmers across eleven European farming systems. Based on three indices for each farmer indicating perceived robustness, adaptability, and transformability of their farms, we identified two classes of farmers with particularly strong and weak resilience profiles respectively. Using nonparametric Mann-Whitney U tests, we furthermore compared other parameters collected via the survey across the identified classes. RESULTS AND CONCLUSIONS Our data sample outputs two classes of similar size characterised by all three perceived resilience capacities being above (below) regional average. This finding suggests that the ...

Europe's agricultural sector faces a range of economic, environmental and social challenges. The accumulation of these uncertainties and their potentially complex interconnections lead to concerns about the long term viability of production of private and public goods, the sustainability of agricultural systems and the vitality of rural areas. Importantly, these risks and uncertainties differ widely across regions, different types of farms and different farming systems, requiring a differentiated response. Responses might try either to reduce stressors or limit their impact, enhance the robustness of farms and farming systems against disturbances, or increase their ability to adapt to changing circumstances. No framework currently exists for a comprehensive assessment of whether policies and governance arrangements effectively enhance the sustainability and resilience of EU farming systems and improve the risk management of EU farms ; EU; en; contact: yann.demey@wur.nl

Farming systems in Europe face a vast range of environmental, economic, social and institutional challenges. Examples include more volatile producer and input prices, higher probability of extreme weather events, increasing dependence on land owners and financial institutions, organizational change within value chains, competing policy objectives and increasing administrative demands, and new societal concerns and changing consumer preferences. In this paper we define resilience as maintaining the essential functions of EU farming systems in the face of increasingly complex and volatile economic, social, environmental and institutional challenges. A farming system is a system hierarchy level above the farm at which properties emerge as a result of the formal and informal interactions and interrelations among farms, available technologies, stakeholders along the value chain, citizens in rural and urban areas, consumers, policy makers, and the environment. Existing resilience frameworks do not sufficiently capture the regional interplay of the multiple processes and stakeholders apparent in farming systems. In order to capture the described developments in EU agriculture, and in order to proactively address those challenges, we propose a framework to analyse the resilience of EU farming systems. The integrated framework can be applied by public and private decision makers to formulate differentiated strategies across EU farming systems depending on context-specific challenges and available resources. ; EU; en; Contact: miranda.meuwissen@wur.nl