IDEAS home Printed from https://ideas.repec.org/a/now/jnljfe/112.00000533.html
   My bibliography  Save this article

Can Satellite-Based Weather Index Insurance Hedge the Mortality Risk of Pine Stands?

Author

Listed:
  • Wienand Kölle
  • Matthias Buchholz
  • Oliver Musshoff

Abstract

Due to rising temperatures, forest stands are increasingly exposed to drought stress, which affects forest productivity through lower growth rates and higher mortality rates. Satellite-based index insurance could be an option for hedging the mortality risk of trees. Therefore, we calculated three remotely-sensed vegetation health indices from MODerate-resolution Imaging Spectroradiometer (MODIS) satellite images. As indices for index insurance we use the Vegetation Condition Index (VCI), the Temperature Condition Index (TCI) and the Vegetation Health Index (VHI). We generate temperature, precipitation and a combined index of the two as benchmark indices. For 12 pine stands in northeastern Germany, we calculate the hedging effectiveness for hypothetically designed index insurance contracts based on satellite and meteorological indices. Both station- and satellite-based insurance contracts have been shown to be effective in hedging standing timber mortality risk. The average hedging effectiveness ranges from 36% for TCI-based to 48% for VHI-based index insurance contracts.

Suggested Citation

  • Wienand Kölle & Matthias Buchholz & Oliver Musshoff, 2021. "Can Satellite-Based Weather Index Insurance Hedge the Mortality Risk of Pine Stands?," Journal of Forest Economics, now publishers, vol. 36(4), pages 315-350, October.
    • Handle: RePEc:now:jnljfe:112.00000533
    DOI: 10.1561/112.00000533
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1561/112.00000533
    Download Restriction: no
    File URL: https://libkey.io/10.1561/112.00000533?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:now:jnljfe:112.00000533. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Lucy Wiseman (email available below). General contact details of provider: http://www.nowpublishers.com/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.