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Relationships among government payments, crop insurance payments and crop revenue

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  • Robert J. Hauser

Abstract

Risk abatement characteristics of a public sector programme (counter-cyclical payments) and a quasi-private market instrument (crop insurance) are assessed at the farm level. Crop market revenues and insurance payments have strong linkages to pre-planting price and yield conditions, whereas the conditions underlying government programme payments are less affected by prices, crop shares or actual yields. Contrary to a belief often expressed by producers, the counter-cyclical programme does not duplicate or substitute strongly for crop insurance programmes. It is also found that measurement of crop-revenue risk abatement from using either public or quasi-private instruments can be particularly sensitive to the price environment and components of market revenue. Copyright 2004, Oxford University Press.

Suggested Citation

  • Robert J. Hauser, 2004. "Relationships among government payments, crop insurance payments and crop revenue," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 31(3), pages 353-368, September.
    • Handle: RePEc:oup:erevae:v:31:y:2004:i:3:p:353-368
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    Cited by:

    1. Anton, Jesus & Giner, Celine, 2005. "Can Risk Reducing Policies Reduce Farmer's Risk and Improve Their Welfare?," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24578, European Association of Agricultural Economists.
    2. Vedenov, Dmitry V. & Power, Gabriel J., 2008. "Risk-Reducing Effectiveness of Revenue versus Yield Insurance in the Presence of Government Payments," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 40(2), pages 1-17, August.
    3. Esther Boere & G. Cornelis van Kooten, 2015. "Reforming the Common Agricultural Policy: Decoupling Agricultural Payments from Production and Promoting the Environment," Working Papers 2015-01, University of Victoria, Department of Economics, Resource Economics and Policy Analysis Research Group.
    4. Cooper, Joseph C. & O'Donoghue, Erik J., 2011. "Identifying and Reducing Overlap in Farm Program Support," 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania 103261, Agricultural and Applied Economics Association.
    5. Dai, Jiawu & Feng, Yuchen & Wang, Yan & Wang, Xiuqing, 2022. "Agricultural support and spatial price transmission: evidence from China’s maize sector," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 26(2), November.

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