Risk-Seeking Behavior in Poorer Cultivators and Growing Income Disparity

A Case of Cash Crop Farming in Teknaf Wildlife Sanctuary, Bangladesh

Abstract

This study examines the risk of cultivating betel leaf, a popular cash crop in the region of southern Bangladesh, and reveals its effect on income generation in connection with forest degradation. We analyzed panel data from farmers for 2010 and 2014 and revealed that betel leaf cultivation has widened income disparity and does not necessarily contribute to income generation, in particular for poorer farmers. Such farmers have undertaken risks including disease, climate change, and price fluctuations, and yet they continue to engage in cultivation. In conclusion, this study provides evidence of poor farmers’ myopic risk-seeking behavior, which contradicts past findings.