This is notably the case when the income tax schedule is convex or when capital market imperfections make the cost of refinancing after a negative shock both higher and convex (Froot et al., Risk mitigation relates to costly activities that reduce the impact of risks for the farm. One usually makes a distinction between self-insurance, which consists in reducing the loss of a given risk when it occurs, and self-protection, which consists in reducing the probability of the risk (Ehrlich and Becker, 1976).