In agriculture, most farmers express their risk aversion in diverse ways, some of which are forward pricing, production practices, insurance, holding liquid reserves, diversification, and liability management or their combination (Boehje and Trede, 1977; Barry, 1984). Generally, these ways have commanded substantial resources from farmers and researchers. In Nigeria, however, most poultry farms are small scale with little opportunity for diversification and insurance. Their attitudes to risk are nevertheless major determinants of the rate of diffusion of new technologies among the farmers and of the outcome of rural development programmes (Tonye et al., 1977; MANR, 1997; Adejoro 2000). For this purpose, this study aimed at identifying the specific determinants of poultry farmers’ attitude to risk and quantifying their impact on decision-making. In this paper, risk is introduced in a model of economic decision making as a safety-first rule. Based on the rule, the security of generating returns large enough to cover subsistence needs influence the decision maker productive resource–use efficiency. According to Scandizzo and Dillon (1976), safety-first criteria tend to be followed whenever the satisfaction of basic needs may be at risk. Given that the safety first model holds, the degree of risk aversion manifested by individual farmer can be obtained from observed behavior. Assuming a production technology, the risk associated with production and market conditions, the observed level of factor use shows the underlying degree of risk aversion (Moscardi and Javry, 1977). Through this indirect approach the attitude towards risk was measured for a cross section sample of small-scale poultry farmers in southwestern Nigeria.

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