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The Impact of Crop Insurance on the Economic Performance of Hungarian Cropping Farms

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  • Sporri, Martina
  • Baráth, Lajos
  • Bokusheva, Raushan
  • Ferto, Imre

Abstract

Crop insurance products can improve and stabilize economic performance. However, due to insurance market imperfections, the use of insurance products often requires governmental support. This paper analyses the actual impact of insurance products on the economic performance of cropping farms by linking the economic performance model with the insurance demand model. For this analysis, a simultaneous equation system is solved. Our estimations show a negative impact of insurance on the economic performance indicators farm profit, labour productivity and land productivity. The analysis of the insurance demand side confirms financial limitations of many farms.

Suggested Citation

  • Sporri, Martina & Baráth, Lajos & Bokusheva, Raushan & Ferto, Imre, 2012. "The Impact of Crop Insurance on the Economic Performance of Hungarian Cropping Farms," 123rd Seminar, February 23-24, 2012, Dublin, Ireland 122525, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaa123:122525
    DOI: 10.22004/ag.econ.122525
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    Cited by:

    1. Agnieszka Kurdyś-Kujawska & Agnieszka Sompolska-Rzechuła & Joanna Pawłowska-Tyszko & Michał Soliwoda, 2021. "Crop Insurance, Land Productivity and the Environment: A Way forward to a Better Understanding," Agriculture, MDPI, vol. 11(11), pages 1-17, November.
    2. Collins-Sowah, Peron A. & Henning, Christian H. C. A., 2019. "Risk management and its implications on household incomes," Working Papers of Agricultural Policy WP2019-05, University of Kiel, Department of Agricultural Economics, Chair of Agricultural Policy.
    3. Fabio G., Santeramo & Ilaria, Russo & Emilia, Lamonaca, 2022. "Italian subsidised crop insurance: what the role of policy changes," MPRA Paper 115299, University Library of Munich, Germany.
    4. Birthal, Pratap S. & Hazrana, Jaweriah & Negi, Digvijay S. & Mishra, Ashok K., 2022. "Assessing benefits of crop insurance vis-a-vis irrigation in Indian agriculture," Food Policy, Elsevier, vol. 112(C).
    5. Mauro Vigani & Jonas Kathage, 2019. "To Risk or Not to Risk? Risk Management and Farm Productivity," American Journal of Agricultural Economics, John Wiley & Sons, vol. 101(5), pages 1432-1454, October.
    6. Embaye, Weldensie T. & Bergtold, Jason S., 2017. "Effect of Crop Insurance Subsidy on Total Farm Productivity of Kansas Farms, US," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258107, Agricultural and Applied Economics Association.
    7. Kemeny, Gabor & Varga, Tibor & Fogarasi, Jozsef & Nemes, Attila, 2013. "The effects of weather risks on micro-regional agricultural insurance premiums in Hungary," Studies in Agricultural Economics, Research Institute for Agricultural Economics, vol. 115(1), pages 1-8, February.
    8. Kemény, Gábor & Varga, Tibor & Fogarasi, József & Tóth, Kristóf, 2012. "The development of Hungarian agricultural insurance system," Problems of World Agriculture / Problemy Rolnictwa Światowego, Warsaw University of Life Sciences, vol. 12(27), pages 1-10, September.

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