Revisiting the demand of agricultural insurance: The case of Spain
AbstractWe use the actual insurance records of 52,300 farmers and 11 years to estimate two sets of insurance demands. We define measures of insurance's expected returns, variance and third moment, based on observed insurance data, and infer the expected returns for those farmers that have never had an indemnity. We estimate several probit models and count models for the insuring vs non-insuring strategies, in which the economic returns of insurance and its two measures of dispersion enter as explanatory variables. Results show that farmers' insurance strategies are largely explained by their actual insurance experience as captured by these three variables. Individuals with loss rations greater than 1 do not show more responsiveness that those facing more balanced premium charges. Results show that adverse selection may not be a major source of inefficiency in the Spanish insurance system.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by European Association of Agricultural Economists in its series 101st Seminar, July 5-6, 2007, Berlin Germany with number 9266.
Date of creation: 2007
Date of revision:
Agricultural insurance; insurance demand models; Spain; Risk and Uncertainty; G22; Q12; Q14;
Other versions of this item:
- Alberto Garrido & David Zilberman, 2008. "Revisiting the demand for agricultural insurance: the case of Spain," Agricultural Finance Review, Emerald Group Publishing, vol. 68(1), pages 43-66, September.
- G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
- Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
- Q14 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Finance
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Bruce A. Babcock & David A. Hennessy, 1996.
"Input Demand under Yield and Revenue Insurance,"
American Journal of Agricultural Economics,
Agricultural and Applied Economics Association, vol. 78(2), pages 416-427.
- Bruce A. Babcock & Joseph A. Herriges, 1994. "Input Demand Under Yield and Revenue Insurance," Center for Agricultural and Rural Development (CARD) Publications 94-wp127, Center for Agricultural and Rural Development (CARD) at Iowa State University.
- Babcock, Bruce A. & Hennessy, David A., 1996. "Input Demand Under Yield and Revenue Insurance," Staff General Research Papers 794, Iowa State University, Department of Economics.
- Keith H. Coble & Thomas O. Knight & Rulon D. Pope & Jeffery R. Williams, 1996. "Modeling Farm-Level Crop Insurance Demand with Panel Data," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(2), pages 439-447.
- Moschini, Giancarlo & Hennessy, David A., 2001.
"Uncertainty, risk aversion, and risk management for agricultural producers,"
Handbook of Agricultural Economics,
in: B. L. Gardner & G. C. Rausser (ed.), Handbook of Agricultural Economics, edition 1, volume 1, chapter 2, pages 88-153
- Moschini, GianCarlo & Hennessy, David A., 2001. "Uncertainty, Risk Aversion, and Risk Management for Agricultural Producers," Staff General Research Papers 5323, Iowa State University, Department of Economics.
- John C. Quiggin & Giannis Karagiannis & J. Stanton, 1993.
"Crop Insurance And Crop Production: An Empirical Study Of Moral Hazard And Adverse Selection,"
Australian Journal of Agricultural and Resource Economics,
Australian Agricultural and Resource Economics Society, vol. 37(2), pages 95-113, 08.
- Quiggin, John C. & Karagiannis, Giannis & Stanton, J., 1993. "Crop Insurance And Crop Production: An Empirical Study Of Moral Hazard And Adverse Selection," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 37(02), August.
- Barnett, Barry J., 2004. "Agricultural Index Insurance Products: Strengths And Limitations," Agricultural Outlook Forum 2004 32971, United States Department of Agriculture, Agricultural Outlook Forum.
- Vincent H. Smith & Barry K. Goodwin, 1996. "Crop Insurance, Moral Hazard, and Agricultural Chemical Use," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(2), pages 428-438.
- Nimon, R. Wesley & Mishra, Ashok K., 2001. "Revenue Insurance and Chemical Input Use Rates," 2001 Annual meeting, August 5-8, Chicago, IL 20669, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- Goodwin, Barry K., 1994. "Premium Rate Determination In The Federal Crop Insurance Program: What Do Averages Have To Say About Risk?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 19(02), December.
- Geoffroy Enjolras & Patrick Sentis, 2008.
"The main determinants of insurance purchase. An empirical study on crop insurance policies in France,"
08-06, LAMETA, Universtiy of Montpellier, revised Apr 2008.
- Enjolras, Geoffroy & Sentis, P., 2008. "The Main Determinants of Insurance Purchase: An Empirical Study on Crop Insurance Policies in France," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44395, European Association of Agricultural Economists.
- Robert Aidoo & James Osei Mensah & Prosper Wie & Dadson Awunyo-vitor, 2014. "Prospects of Crop Insurance as a Risk Management Tool among Arable Crop Farmers in Ghana," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 4(3), pages 341-354, March.
- Garrido, Alberto & Bielza, Maria, 2008. "Income Stabilisation in a Changing Agricultural World: Policy and Tools," 108th Seminar, February 8-9, 2008, Warsaw, Poland 48108, European Association of Agricultural Economists.
- Di Falco, Salvatore & Capitanio, Fabian & Adinolfi, Felice, 2011. "Natural Vs Financial Insurance in the Management of Weather Risk Exposure in the Italian Agriculture," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114325, European Association of Agricultural Economists.
- Margarita Genius & Phoebe Koundouri & Celine Nauges & Vangelis Tzouvelekas, 2012.
"Information Transmission in Irrigation Technology Adoption and Diffusion: Social Learning, Extension Services and Spatial Effects,"
1211, University of Crete, Department of Economics, revised 30 Apr 2013.
- Margarita Genius & Phoebe Koundouri & Celine Nauges & Vangelis Tzouvelekas, . "Information Transmission in Irrigation Technology Adoption and Diffusion: Social Learning, Extension Services, and Spatial Effects," DEOS Working Papers 1329, Athens University of Economics and Business.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search).
If references are entirely missing, you can add them using this form.