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Yield And Income Risk Reduction Under Alternative Crop Insurance And Disaster Assistance Designs

Author

Listed:
  • Carriker, Gordon L.
  • Williams, Jeffery R.
  • Barnaby, Glenn Arthur, Jr.
  • Black, J. Roy

Abstract

This study compares the effectiveness of five crop insurance/disaster assistance plans: an individual farm-yield insurance plan similar to the current Federal Crop Insurance Corporation multiperil program, two area-yield insurance plans, a farm-yield disaster assistance plan, and an area-yield disaster assistance plan. These methods are examined for reduction in yield and gross income variability with and without participation in the government deficiency payment program using farm-level yield data from 98 dryland wheat farms and 38 dryland corn farms in Kansas. Although individual farm-yield insurance is complex, suffers from moral hazard and adverse selection problems, and is likely to be the most expensive to administer, it provides more yield and gross income risk reduction than any of the alternative insurance/disaster assistance plans.

Suggested Citation

  • Carriker, Gordon L. & Williams, Jeffery R. & Barnaby, Glenn Arthur, Jr. & Black, J. Roy, 1991. "Yield And Income Risk Reduction Under Alternative Crop Insurance And Disaster Assistance Designs," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 16(2), pages 1-13, December.
    • Handle: RePEc:ags:wjagec:32588
    DOI: 10.22004/ag.econ.32588
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    References listed on IDEAS

    as
    1. Jeffery R. Williams & Jayson K. Harper & G. Art Barnaby, 1990. "Government Program Impacts on the Selection of Crop Insurance in Northeastern Kansas," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 12(2), pages 207-221.
    2. Anderson, Jock R. & Dillon, John L. & Hardaker, Brian, 1977. "Agricultural Decision Analysis," Monographs: Applied Economics, AgEcon Search, number 288652, November.
    3. Barnaby, Glenn Arthur, Jr. & Skees, Jerry R., 1990. "PUBLIC POLICY FOR CATASTROPIDC YIELD RISK: An Alternative Crop Insurance Program," Choices: The Magazine of Food, Farm, and Resource Issues, Agricultural and Applied Economics Association, vol. 5(2), pages 1-3.
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    1. Carriker, Gordon & Williams, Jeffery & Barnaby, G. Art Jr., 1991. "Comparative Performance of Individual and Area Measured Crop Insurance Programs," WAEA/ WFEA Conference Archive (1929-1995) 321452, Western Agricultural Economics Association.
    2. Matthieu Stigler & David Lobell, 2020. "On the benefits of index insurance in US agriculture: a large-scale analysis using satellite data," Papers 2011.12544, arXiv.org, revised Nov 2021.
    3. Calum G. Turvey & Zahirul Islam, 1995. "Equity and efficiency considerations in area versus individual yield insurance," Agricultural Economics, International Association of Agricultural Economists, vol. 12(1), pages 23-35, April.
    4. Gustafson, Cole R. & Crane, Laurence M. & Fischer, William R., 1995. "Agronomic, Economic, and Demographic Characteristics of Crop Farms in the Great Plains and Corn Belt," Agricultural Economics Reports 23221, North Dakota State University, Department of Agribusiness and Applied Economics.
    5. Dongli Wu & Shan He & Lingui Qin & Jingyue Feng & Yu Gao, 2024. "Role of Policy-Supported Hog Insurance in Promoting Green Total Factor Productivity: The Case of China during 2005–2021," Agriculture, MDPI, vol. 14(7), pages 1-24, June.
    6. Williams, Jeffery R. & Carriker, Gordon L. & Barnaby, G. Art & Harper, Jayson K. & Black, J. Roy, 1991. "Area-Measured Crop Insurance And Disaster Aid For Wheat And Grain Sorghum," 1991 Annual Meeting, August 4-7, Manhattan, Kansas 271256, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    7. Williams, Jeffery R. & Saffert, Andrew T. & Barnaby, G. Art & Llewelyn, Richard V. & Langemeier, Michael R., 2014. "A Risk Analysis of Adjusted Gross Revenue-Lite on Beef Farms," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 46(2), pages 227-244, May.
    8. Stigler, Matthieu M. & Lobell, David, 2020. "Suitability of index insurance: new insights from satellite data," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304663, Agricultural and Applied Economics Association.

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    Keywords

    Risk and Uncertainty;

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