Heuristics and farm heterogeneity: Evidence from small-scale farmers in Brazil

Heuristics have been regarded as a promising approach for understanding the fundamental ongoing debate about the heterogeneity of small-scale farmers. In this paper, our objective is to identify the heuristics found among small-scale producers settled in the State of Sa similar to o Paulo, Brazil. The agrarian reform program in Brazil gave the same resource dotation (land) for each settler in the 1980s. All of them started with similar agricultural experience and resources, and experienced similar uncertainties over a long period of time. However, they have developed different decision-making processes and resource configurations. Based on an empirical study, we carried out our primary data collection in two phases: the first was conducted in person at the producers' homes to identify the decision-making processes involved in their production resources management; the second consisted on a questionnaire applied to 125 producers representing family units. We found a set of heuristics which serves as basis for identifying five individual archetypes: the accumulator (whose main heuristics are associated with increasing their resources); the risk outsourcer (who tends to outsource resources for someone else to exploit due to the risks associated with the activity); the imitator (who tends to adopt imitative behavior); the integrator (who tends to build multiple touch points of collaborations); and the improver (who is oriented to continuously improving the available resources). Our study indicates that individuals employ different archetypes, based on different heuristics, which can lead to different decision-making processes. We conclude on the importance of creating an adequate institutional environment, taking into account that settlers react to policy incentives according to their own ways of interpreting and solving problems.