Exploring Factors Shaping Estonian Farmers’ Risk Attitudes

Abstract This study examines risk attitudes among Estonian farmers, addressing evidence gaps for smaller EU countries. Using an online survey conducted in 2024 (n = 541), we measure risk attitudes on an 11-point scale across six context-specific items. We construct a latent overall risk-taking score via confirmatory factor analysis and estimate associations with demographic and farm characteristics using ordinary least squares regression; k-means clustering identifies risk profiles. Results show that agricultural area is positively associated with risk-taking, while age is negatively related to willingness to take risks. Higher education relates to greater willingness to take risks, especially with respect to experimentation with new crops and production practices. Willingness to use agricultural insurance is positively associated with risk-taking. Risk attitudes also vary by production type: horticulture and perennial crop farmers declare themselves to be more risk-taking than arable crop farmers, whereas livestock and dairy farmers do not differ. Clustering reveals distinct farmer profiles, suggesting scope for targeted risk management strategies.