This paper examines the potential for adverse selection when farmers are offered a portfolio of insurance policies. We analyze the risk characteristics farmers who bought alternative insurance instruments in 1996-97. Inability to differentiate farmers according to risk types results in pooling equilibrium which may implicitly subsidize high risk farmers.
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Paper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 1998 Annual meeting, August 2-5, Salt Lake City, UT with number
21002.
Length: Date of creation: 1998 Date of revision: Handle: RePEc:ags:aaea98:21002
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