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Directional Spatial Dependence and Its Implications for Modeling Systemic Yield Risk


  • Zhu, Ying
  • Ghosh, Sujit K.
  • Goodwin, Barry K.


The objective of this study is to evaluate and model the spatial dependence of systemic yield risk. Various spatial autoregressive models are explored to account for county level dependence of crop yields. The results show that the time trend parameters of yields are correlated across spaces and the spatial correlations are changing with time. In addition, the spatial correlation of neighborhood in west/east direction is stronger than that of north/south direction. The information of the spatial dependence of yield risk will help the construction of better risk management programs for protecting producers from systemic yield risks.

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  • Zhu, Ying & Ghosh, Sujit K. & Goodwin, Barry K., 2009. "Directional Spatial Dependence and Its Implications for Modeling Systemic Yield Risk," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49455, Agricultural and Applied Economics Association.
  • Handle: RePEc:ags:aaea09:49455

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    References listed on IDEAS

    1. Anselin, Luc, 2002. "Under the hood Issues in the specification and interpretation of spatial regression models," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 27(3), November.
    2. Anselin, Luc, 2002. "Under the hood : Issues in the specification and interpretation of spatial regression models," Agricultural Economics, Blackwell, vol. 27(3), pages 247-267, November.
    3. Barry K. Goodwin & Alan P. Ker, 1998. "Nonparametric Estimation of Crop Yield Distributions: Implications for Rating Group-Risk Crop Insurance Contracts," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(1), pages 139-153.
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    Spatial Autoregressive Model; Spatial Dependence; Risk and Uncertainty;

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