A Cognitive Perspective on the Mechanisms Shaping Farmers' Risk Preferences

ABSTRACT

China's rural revitalization strategy has improved farmers' education, technology adoption, and health. However, the rural economy still lacks scientific guidance, and farmers remain risk‐averse. This study examined the cognitive mechanisms shaping farmers' risk preferences. Based on experimental data, attention, and self‐control were found to be key cognitive factors influencing risk preference, both showing an inverted U‐shaped relationship. Moderate levels of attention and self‐control were found to encourage balanced risk‐taking, while extreme levels reduce it. Moreover, self‐control mediated the relationship between attention and risk preference. The findings further revealed cognitive thresholds, indicating that improvements in attention and self‐control do not uniformly increase risk‐taking willingness but may produce different behavioral outcomes once these thresholds are crossed. By identifying this nonlinear threshold effect, this study advances our understanding of how cognitive capacities shape farmers' economic behavior. Moreover, the findings have policy implications for enhancing farmers' rationality and promoting sustainable agricultural modernization.