Potato Fluctuation, and Risk Preference of Potato Farming in the Bromo Plateau, Indonesia

Potato farming in Indonesia is carried out in the highlands one of them is the Bromo plateau/highland. Highland farming has a high risk of production due to sloping land topography and steep slopes. In addition, low managerial ability in responding to sources of production risk result in the input allocation produce non optimal production so that the input used is less efficient. This research aimed to identify production fluctuation and farmers' risk preferences, measure the level of technical efficiency, and determine the effect of risk preference, land conservation technology and socioeconomic factors on technical efficiency. The respondents in this study were 83 farmers. Just and Pope risk function with a utility function approach to find farmers' risk preferences, technical efficiency measurements using the stochastic Frontier Cobb Douglas which processed using the Frontier 4.1 program, while to find out the influence of the factors that influence efficiency used Tobit regression. The analysis showed that the respondents behaved risk takers amounted to 62,65%. Respondent has not yet reached technical efficiency with an average level of technical efficiency of 0.774. Education, frequency of counseling and training, the application of terrace systems have a significant positive effect on technical efficiency while land slope has a significant negative effect. Risk preference isn’t affected on the technical efficiency and show positive sign. Therefore, need the existence of policies that focus on the factors that cause technical inefficiencies so that farmers' managerial capacity is increased.