Contents & Foreword, Characterizing And ... - IRRI books

and Itgaon, however, the plot-level CVs of yield are quite high by conventional standards.The CVs of net returns (defined as gross returns minus cash costs) are evenhigher and are indicative of the high levels of variability that farmers in rainfed environmentshave to deal with. The large difference between the CV of yield and netreturns also indicates that yield variability can severely underestimate risk if the farmers’objective is to obtain stable net returns. Analysis based on yield variability alonecan hence be misleading.Crop diversification and riskThe diversification indices (Table 4) indicate that the cropping pattern in Itgaon ismore diversified than in Mungeshpur for both the kharif (rainy) and rabi (postrainy)seasons. In Itgaon, farmers grow rice in proportionately smaller areas than inMungeshpur and rely more on pulses and maize, which grow well under rainfed conditions.Mixed cropping and intercropping are also more common in Itgaon. Of thefive years, the kharif season diversification indices are higher during the droughtyears (1995 and 1996). These results indicate that crop diversification may be animportant risk-reducing strategy, especially to farmers of Itgaon. The average CV ofincome from all rainy-season crops is substantially lower than the CV of rice income(Table 5). Using a multiple regression analysis of the CV of rainy-season crop incomeon farm size and diversification index, Pandey et al (1999) show that more diversifiedfarms in Itgaon do have a lower variability of crop income. The stabilization effect isTable 4. Crop diversification index.YearMungeshpurItgaonKharif Rabi Kharif Rabi1994 0.47 0.56 0.72 0.711995 0.53 0.55 0.90 0.771996 0.58 0.57 0.82 0.671997 0.50 0.53 0.75 0.681998 0.45 0.53 0.78 0.62Table 5. Coefficient of variation (CV) of income from different sources,1994-98. aItem Mungeshpur ItgaonCV of rice income (%) 30 76CV of all rainy-season crop income (%) 28 23CV of all crop income (%) 10 9CV of all income 9 12a These coefficients of variation are the average values (across households) ofthe coefficient of variation for each household calculated using temporal datafor that household.328 Singh et al