ECONOMIC AND FINANCIAL ANALYSIS OF AN INTEGRATED AND SUSTAINABLE AGROECOLOGICAL PRODUCTION SYSTEM (PAIS)

Abstract

Economic and financial assessments are important for investments in the food production sector, especially in emerging markets with higher risk. Uncertainty tends to impact decisions in organizations, development agents, and the choices
made by rural producers. However, there is limited empirical contribution on the risk of investing in agroecological systems, which makes it difficult to choose alternatives for income generation and food security. Thus, the objective was to analyze the economic viability of an Integrated and Sustainable Agroecological Production System (PAIS). A case study was conducted in the city of Dourados, MS, interviewing a manager of the Brazilian Service of Support to Micro and Small Business, a field technician of the National Service for Rural Learning, and a family farmer. The methodology used capital budgeting techniques (NPV, IRR, TIRM, VAUE, IL and PBd) and was differentiated by the risk analysis using the Monte Carlo method and by adopting an approach aligned with the emerging market condition, such as Brazil. With the minimum attractiveness rate (TMA) (8.7525%) calculated with the Hybrid CAPM Model (AH-CAPM), the results were: NPV= R$ 62,550.13; IRR= 55.74%; TIRM= 24.78%; VAUE= R$ 9,640.65; IL= 3.95; PBd= 2.03 years. The probability of the NPV being negative was 0.5%. The empirical contribution, with emphasis on risk, points to the viability of the agroecological system PAIS, which can subsidize the choice for technologies and food production models aligned with sustainable rural development and the strengthening of family farming.