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This study examines the impact of the row planting method on maize productivity and risk exposure using panel datasets from Ethiopia. A flexible moment-based production function is fitted to capture the expected yield, yield variance, and exposure to downside risk. A Mundlak–Chamberlain approach is combined with a switching regression treatment effects model to account for unobserved heterogeneity and endogeneity. The study shows that adopters of the row planting method significantly reduced exposure to downside risk while increasing expected yield. The analysis also identified some household and environmental conditions that affect the gain from the row planting method. [ABSTRACT FROM AUTHOR]

• This study explores diversity in the risk perception and risk preferences of Ethiopian households and the relationship between them. • Multiple past shocks and future risks are perceived as important across production, market, institutional, financial and personal risk domains. • Our respondents care most about sources of risk with considerable expected impact, even when the perceived probability is low. • Our respondents are relatively risk-averse and loss-averse, able to discriminate probability, though overweight unlikely extreme outcomes. • Risk aversion, loss aversion and probability weighting relate to overall, domain-specific and the impact dimension of future risk perception. Households in developing countries are exposed to various shocks and risks, which leaves them vulnerable as they typically have limited resources to cope with them. Even though a large body of development literature has focused on the role of risk in rural livelihoods, the focus is often on single sources of risk and taking a unidimensional view on risk preference. This paper explores the diversity in risk perception and risk preferences of Ethiopian households by combining incentivized field experiments with detailed primary household survey data. We disentangle the relationship between risk perception and risk preferences using an innovative combination of time framing and instrumental variable estimation approaches. We find that our respondents are exposed to multiple past shocks and perceive multiple sources of future threats across different agricultural risk domains. Our respondents can be characterized as relatively risk-averse and loss-averse, and they also overweight unlikely extreme outcomes. We find a statistically significant association between the prospect theory risk preferences parameters—risk aversion, loss aversion, and probability weighting—and overall risk perception, domain-specific risk perceptions (except for the personal domain) and the impact dimension of future risk. Our findings make an important contribution to our understanding of farm households' risk behavior, and can guide prioritizing development efforts to stimulate better informed and well-targeted risk management policy interventions. [ABSTRACT FROM AUTHOR]