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Demand for Farm Insurance Under Financial Constraints

Author

Listed:
  • Lajos Baráth
  • Raushan Bokusheva
  • Imre Fertő

Abstract

This article investigates the effect of the use of crop insurance on farms’ economic performance. The authors hypothesize the existence of reciprocal causation between crop insurance use and the economic performance of farms in an environment characterized by imperfect financial markets and farm budget constraints. The results confirm the reciprocal causation hypothesis. Economic performance is found to positively influence farms’ demand for insurance, confirming the significance of budget constraints. Moreover, insurance is found to have a negative effect on Hungarian farms’ economic performance, implying that the crop insurance system is inefficient.

Suggested Citation

  • Lajos Baráth & Raushan Bokusheva & Imre Fertő, 2017. "Demand for Farm Insurance Under Financial Constraints," Eastern European Economics, Taylor & Francis Journals, vol. 55(4), pages 357-376, July.
    • Handle: RePEc:mes:eaeuec:v:55:y:2017:i:4:p:357-376
    DOI: 10.1080/00128775.2017.1294986
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    Cited by:

    1. Sofia Kislingerová & Jindřich Špička, 2022. "Factors Influencing the Take-Up of Agricultural Insurance and the Entry into the Mutual Fund: A Case Study of the Czech Republic," JRFM, MDPI, vol. 15(8), pages 1-17, August.
    2. Shirinyan Lada & Arych Mykhailo & Rohanova Hanna, 2021. "Influence of Insurance on Competitiveness of Food Enterprises in Ukraine," Management Theory and Studies for Rural Business and Infrastructure Development, Sciendo, vol. 43(1), pages 5-12, March.

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