Protection Motivation Theory and Farmers' Participation in Futures Markets: Evidence From Germany

Abstract This study examines why European farmers show limited adoption of commodity futures contracts despite substantial price volatility, applying Protection Motivation Theory to understand the cognitive processes driving participation decisions in futures markets. Survey data from 303 German farmers collected in 2024 were analyzed using Partial Least Squares Structural Equation Modeling. The extended PMT framework incorporated threat appraisal (perceived severity and vulnerability), coping appraisal (response efficacy, costs, and self-efficacy), and social norms. Implementation barriers and social norms, rather than price risk perceptions, primarily are associated with adoption decisions. Social norms showed the strongest correlation with adoption intentions, while response costs exhibited a negative correlation. Surprisingly, neither perceived severity nor vulnerability of price risks are correlated with adoption intentions. Policy interventions should focus on reducing administrative burdens and leveraging peer networks rather than increasing risk awareness. Agricultural advisors should emphasize practical implementation support over general risk education. The study demonstrates that protective financial behaviors follow different patterns than health or environmental domains, with response evaluation and social context outweighing threat perception. This research provides the first application of PMT to commodity futures adoption, offering a nuanced framework that distinguishes between risk perception components and implementation barriers previously conflated in agricultural adoption studies. JEL: Q11, Q12, Q13