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The Debate on Public Support to Crop Insurance


  • Carlo Cafiero


Within the context of the debate on agricultural income stabilisation, many suggest the need for direct or indirect public support to crop insurance. This arti-cle questions the value of such a form of intervention. The potential benefits of public support to crop insurance depend upon the answers to the following ques-tions: (i) Is it true that agricultural incomes’ variability has increased in the re-cent years, following the reform of agricultural policies after Gatt and Wto agreements? (ii) Is it really true that agricultural incomes volatility, even if it is a problem, cannot be effectively managed with private instruments? (iii) Even if there is the need for public intervention, under what conditions a subsidy to insur-ance premiums is the best solution? Recent literature has yet to provide convinc-ing answers to these questions. In this article, by reviewing the available evidence after many years of public support to crop insurance in several western countries, doubts are raised on the effective value of such an instrument.

Suggested Citation

  • Carlo Cafiero, 2003. "The Debate on Public Support to Crop Insurance," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 3, December.
  • Handle: RePEc:rar:journl:0147

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    More about this item


    Crop Insurance; Agricultural Policy; Risk Management; Income Stabilisation;

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation


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