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Farmers and Pixels: Toward Sustainable Agricultural Finance with Space Technology

Author

Listed:
  • Sommarat Chantarat
  • Preesan Rakwatin
  • Chutatong Charumilind

Abstract

This paper explores promises of satellite technology in creating high-quality agricultural risk information necessary for unlocking market inefficiencies that have precluded sustainable development of insurance markets and overall risk management in agricultural sector, where uninsured risk remains a leading impediment of economic development. Using pixel-level, high resolution, high frequency and longitudinal satellite data together with a combination of geographical information system (GIS) data, administrative and household-level agricultural data, this paper answers three questions: (1) Can satellite data be used to generate high-quality risk information for Thai rice farmers? (2) How might the satellite-based risk information be used to crowd in sustainable markets for agricultural finance? And (3) What are potential economic impacts of having high quality agricultural data on farmers, agricultural banks and government? After illuminating the potential values of investing in high-quality agricultural data, this paper also discusses key challenges and ways forward in bringing this research into real action to enhance financial stability of farmers, financial system and government.

Suggested Citation

  • Sommarat Chantarat & Preesan Rakwatin & Chutatong Charumilind, 2017. "Farmers and Pixels: Toward Sustainable Agricultural Finance with Space Technology," PIER Discussion Papers 75, Puey Ungphakorn Institute for Economic Research.
    • Handle: RePEc:pui:dpaper:75
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    File URL: https://www.pier.or.th/files/dp/pier_dp_075.pdf
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    Citations

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    Cited by:

    1. Francis Rathinam & Sayak Khatua & Zeba Siddiqui & Manya Malik & Pallavi Duggal & Samantha Watson & Xavier Vollenweider, 2021. "Using big data for evaluating development outcomes: A systematic map," Campbell Systematic Reviews, John Wiley & Sons, vol. 17(3), September.
    2. Attavanich, Witsanu, 2023. "A Review of the Impact of Climate Change on Food Security and Co-Benefits of Adaptation and Mitigation Options in Thailand," MPRA Paper 119565, University Library of Munich, Germany, revised 28 Sep 2023.

    More about this item

    Keywords

    Satellite technology; Agricultural Risk; Agricultural Insurance; Risk-contingent Credit; Rice Production; Thailand;
    All these keywords.

    JEL classification:

    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • 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
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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