IDEAS home Printed from https://ideas.repec.org/a/zbw/espost/242479.html
   My bibliography  Save this article

Mapping weather risk – A multi-indicator analysis of satellite-based weather data for agricultural index insurance development in semi-arid and arid zones of Central Asia

Author

Listed:
  • Eltazarov, Sarvarbek
  • Bobojonov, Ihtiyor
  • Kuhn, Lena
  • Glauben, Thomas

Abstract

Index insurance has been introduced as a solution to tackle several challenges that prevail in the agricultural insurance sector of developing countries. One of the main implementation challenges in these countries is the lack of reliable weather data for index development and implementation. The increasing availability of satellite data could ease the constraints of data access. Meanwhile, the suitability of various satellite products for yield estimation across world regions has to undergo a thorough assessment. This study contributes to the literature by systematically analyzing the accuracy of some globally available satellite data, namely the Global Satellite Mapping of Precipitation (GSMaP), Climate Hazards Group InfraRed Precipitation with Station (CHIRPS), and the Global Land Data Assimilation System (GLDAS) compared to ground-level weather information for 14 different indicators for the case of Uzbekistan. Our analysis indicates that those sources may provide the necessary data for an accessible and adequate climate service. However, a considerable risk of overestimation and underestimation depending on the source of satellite data may exist, especially for precipitation data in the conditions of Central Asia. Among the tested datasets, GSMaP showed a relatively better performance than CHIRPS in precipitation estimation for drought and flood detection. In order to reduce detection inaccuracy, the application of satellite weather products for index insurance is possible when temporal aggregation (e.g., monthly, seasonal) is considered. Globally available climate data could serve as a good source to establish index insurance products in Central Asia; however, a careful selection of source and index is required.

Suggested Citation

  • Eltazarov, Sarvarbek & Bobojonov, Ihtiyor & Kuhn, Lena & Glauben, Thomas, 2021. "Mapping weather risk – A multi-indicator analysis of satellite-based weather data for agricultural index insurance development in semi-arid and arid zones of Central Asia," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 23.
    • Handle: RePEc:zbw:espost:242479
    DOI: 10.1016/j.cliser.2021.100251
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/242479/1/Eltazarov_2021_Mapping_weather_risk.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.1016/j.cliser.2021.100251?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. William R. Sutton & Jitendra P. Srivastava & James E. Neumann & Kenneth M. Strz?pek & Peter Droogers, 2013. "Reducing the Vulnerability of Albania's Agricultural Systems to Climate Change : Impact Assessment and Adaptation Options," World Bank Publications - Books, The World Bank Group, number 16198.
    2. Bokusheva, Raushan & Breustedt, Gunnar, 2012. "The Effectiveness of Weather-Based Index Insurance and Area-Yield Crop Insurance: How Reliable are ex post Predictions for Yield Risk Reduction?," Quarterly Journal of International Agriculture, Humboldt-Universitaat zu Berlin, vol. 51(2), pages 1-22, May.
    3. William R. Sutton & Jitendra P. Srivastava & James E. Neumann & Kenneth M. Strz?pek & Brent B. Boehlert, 2013. "Reducing the Vulnerability of the Former Yugoslav Republic of Macedonia's Agricultural Systems to Climate Change : Impact Assessment and Adaptation Options," World Bank Publications - Books, The World Bank Group, number 16201.
    4. William R. Sutton & Jitendra P. Srivastava & James E. Neumann & Ana Iglesias & Brent B. Boehlert, 2013. "Reducing the Vulnerability of Moldova's Agricultural Systems to Climate Change : Impact Assessment and Adaptation Options," World Bank Publications - Books, The World Bank Group, number 16199.
    5. Ashlee Westerhold & Cory Walters & Kathleen Brooks & Monte Vandeveer & Jerry Volesky & Walter Schacht, 2018. "Risk implications from the selection of rainfall index insurance intervals," Agricultural Finance Review, Emerald Group Publishing Limited, vol. 78(5), pages 514-531, May.
    6. World Bank, 2005. "Drought : Management and Mitigation Assessment for Central Asia and the Caucasus," World Bank Publications - Reports 8724, The World Bank Group.
    7. Benjamin Collier & Jerry Skees & Barry Barnett, 2009. "Weather Index Insurance and Climate Change: Opportunities and Challenges in Lower Income Countries," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 34(3), pages 401-424, July.
    8. Bobojonov, Ihtiyor & Berg, Ernst & Franz-Vasdeki, Jennifer & Martius, Christopher & Lamers, John P.A., 2016. "Income and irrigation water use efficiency under climate change: An application of spatial stochastic crop and water allocation model to Western Uzbekistan," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 13, pages 19-30.
    9. Bobojonov, Ihtiyor & Aw-Hassan, Aden, 2014. "Impacts of climate change on farm income security in Central Asia: An integrated modeling approach," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 188, pages 245-255.
    10. Martin Odening & Oliver Musshoff & Wei Xu, 2007. "Analysis of rainfall derivatives using daily precipitation models: opportunities and pitfalls," Agricultural Finance Review, Emerald Group Publishing Limited, vol. 67(1), pages 135-156, May.
    11. William R. Sutton & Jitendra P. Srivastava & James E. Neumann & Peter Droogers & Brent B. Boehlert, 2013. "Reducing the Vulnerability of Uzbekistan's Agricultural Systems to Climate Change : Impact Assessment and Adaptation Options," World Bank Publications - Books, The World Bank Group, number 16200.
    12. Sandra Broka & Åsa Giertz & Garry Christensen & Charity Hanif & Debra Rasmussen & Rhoda Rubaiza, 2016. "Kyrgyz Republic Agricultural Sector Risk Assessment," World Bank Publications - Reports 23764, The World Bank Group.
    13. J. N. Okpara & E. A. Afiesimama & A. C. Anuforom & A. Owino & K. O. Ogunjobi, 2017. "The applicability of Standardized Precipitation Index: drought characterization for early warning system and weather index insurance in West Africa," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 89(2), pages 555-583, November.
    14. Oliver Musshoff, 2008. "Indifference Pricing of Weather Derivatives," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 90(4), pages 979-993.
    15. Million Tadesse & Bekele Shiferaw & Olaf Erenstein, 2015. "Weather index insurance for managing drought risk in smallholder agriculture: lessons and policy implications for sub-Saharan Africa," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 3(1), pages 1-21, December.
    16. Barnett, Barry J. & Barrett, Christopher B. & Skees, Jerry R., 2008. "Poverty Traps and Index-Based Risk Transfer Products," World Development, Elsevier, vol. 36(10), pages 1766-1785, October.
    17. Sarah Conradt & Robert Finger & Raushan Bokusheva, 2015. "Tailored to the extremes: Quantile regression for index-based insurance contract design," Agricultural Economics, International Association of Agricultural Economists, vol. 46(4), pages 537-547, July.
    18. Barry J. Barnett & Olivier Mahul, 2007. "Weather Index Insurance for Agriculture and Rural Areas in Lower-Income Countries," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 89(5), pages 1241-1247.
    19. Sommarat Chantarat & Christopher B. Barrett & Andrew G. Mude & Calum G. Turvey, 2007. "Using Weather Index Insurance to Improve Drought Response for Famine Prevention," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 89(5), pages 1262-1268.
    20. Eleanor Fisher & Jon Hellin & Helen Greatrex & Nathaniel Jensen, 2019. "Index insurance and climate risk management: Addressing social equity," Development Policy Review, Overseas Development Institute, vol. 37(5), pages 581-602, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Laura Moritz & Lena Kuhn & Ihtiyor Bobojonov, 2023. "The role of peer imitation in agricultural index insurance adoption: Findings from lab‐in‐the‐field experiments in Kyrgyzstan," Review of Development Economics, Wiley Blackwell, vol. 27(3), pages 1649-1672, August.
    2. Eltazarov, Sarvarbek, 2023. "The potential of satellite-based data to detect weather extremes and crop yield variation for hedging agricultural weather risks in Central Asia and Mongolia: Three essays," EconStor Theses, ZBW - Leibniz Information Centre for Economics, number 286134, September.
    3. Li, Yifei & Huang, Shengzhi & Wang, Hanye & Zheng, Xudong & Huang, Qiang & Deng, Mingjiang & Peng, Jian, 2022. "High-resolution propagation time from meteorological to agricultural drought at multiple levels and spatiotemporal scales," Agricultural Water Management, Elsevier, vol. 262(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Antoine Leblois & Philippe Quirion, 2013. "Agricultural insurances based on meteorological indices: realizations, methods and research challenges," Post-Print hal-00656778, HAL.
    2. Wienand Kölle & Andrea Martínez Salgueiro & Matthias Buchholz & Oliver Musshoff, 2021. "Can satellite‐based weather index insurance improve the hedging of yield risk of perennial non‐irrigated olive trees in Spain?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 65(1), pages 66-93, January.
    3. Eltazarov, Sarvarbek, 2023. "The potential of satellite-based data to detect weather extremes and crop yield variation for hedging agricultural weather risks in Central Asia and Mongolia: Three essays," EconStor Theses, ZBW - Leibniz Information Centre for Economics, number 286134, September.
    4. Shih-Chieh Liao & Shih-Chieh Chang & Tsung-Chi Cheng, 2021. "Managing the Volatility Risk of Renewable Energy: Index Insurance for Offshore Wind Farms in Taiwan," Sustainability, MDPI, vol. 13(16), pages 1-27, August.
    5. Vladimir Otrachshenko & Olga Popova & Nargiza Alimukhamedova, 2024. "Rainfall variability and labor allocation in Uzbekistan: the role of women’s empowerment," Post-Soviet Affairs, Taylor & Francis Journals, vol. 40(2), pages 119-138, March.
    6. Wong, Ho Lun & Wei, Xiangdong & Kahsay, Haftom Bayray & Gebreegziabher, Zenebe & Gardebroek, Cornelis & Osgood, Daniel E. & Diro, Rahel, 2020. "Effects of input vouchers and rainfall insurance on agricultural production and household welfare: Experimental evidence from northern Ethiopia," World Development, Elsevier, vol. 135(C).
    7. Alan Fuchs & Hendrik Wolff, 2011. "Concept and Unintended Consequences of Weather Index Insurance: The Case of Mexico," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 93(2), pages 505-511.
    8. Doms, Juliane, 2017. "Put, call or strangle? About the challenges in designing weather index insurances to hedge performance risk in agriculture," 57th Annual Conference, Weihenstephan, Germany, September 13-15, 2017 261990, German Association of Agricultural Economists (GEWISOLA).
    9. Möllmann, Johannes & Buchholz, Matthias & Kölle, Wienand & Musshoff, Oliver, 2020. "Do remotely-sensed vegetation health indices explain credit risk in agricultural microfinance?," World Development, Elsevier, vol. 127(C).
    10. Linging Hou & Dana L.K. Hoag & Yueying Mu, 2011. "Testing for adverse selection of crop insurance in northern China," China Agricultural Economic Review, Emerald Group Publishing Limited, vol. 3(4), pages 462-475, November.
    11. Bucheli, Janic & Dalhaus, Tobias & Finger, Robert, 2022. "Temperature effects on crop yields in heat index insurance," Food Policy, Elsevier, vol. 107(C).
    12. Tappi, Marco & Carucci, Federica & Gatta, Giuseppe & Giuliani, Marcella Michela & Lamonaca, Emilia & Santeramo, Fabio Gaetano, 2023. "Temporal and design approaches and yield-weather relationships," MPRA Paper 117488, University Library of Munich, Germany.
    13. Vroege, Willemijn & Dalhaus, Tobias & Finger, Robert, 2019. "Index insurances for grasslands – A review for Europe and North-America," Agricultural Systems, Elsevier, vol. 168(C), pages 101-111.
    14. Müller, Birgit & Quaas, Martin F. & Frank, Karin & Baumgärtner, Stefan, 2011. "Pitfalls and potential of institutional change: Rain-index insurance and the sustainability of rangeland management," Ecological Economics, Elsevier, vol. 70(11), pages 2137-2144, September.
    15. Shih‐Chieh Liao & Shih‐Chieh Chang & Tsung‐Chi Cheng, 2022. "Index‐based renewable energy insurance for Taiwan Solar Photovoltaic Power Plants," Risk Management and Insurance Review, American Risk and Insurance Association, vol. 25(2), pages 145-172, June.
    16. Jensen, Nathaniel D. & Mude, Andrew G. & Barrett, Christopher B., 2018. "How basis risk and spatiotemporal adverse selection influence demand for index insurance: Evidence from northern Kenya," Food Policy, Elsevier, vol. 74(C), pages 172-198.
    17. Mengmeng Qiang & Manhong Shen & Guanjun Xia, 2023. "The effectiveness of weather index insurance in managing mariculture production risk," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 67(2), pages 245-262, April.
    18. Che Mohd Imran Che Taib & Mukminah Darus, 2019. "Spatial-Temporal Modelling of Temperature for Pricing Temperature Index Insurance," Asia-Pacific Financial Markets, Springer;Japanese Association of Financial Economics and Engineering, vol. 26(1), pages 87-106, March.
    19. Quentin Stoeffler & Michael Carter & Catherine Guirkinger & Wouter Gelade, 2022. "The Spillover Impact of Index Insurance on Agricultural Investment by Cotton Farmers in Burkina Faso," The World Bank Economic Review, World Bank, vol. 36(1), pages 114-140.
    20. Alexis Berg & Philippe Quirion & Benjamin Sultan, 2009. "Weather-index drought insurance in Burkina-Faso: assessment of its potential interest to farmers," Post-Print hal-00520893, HAL.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:espost:242479. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/zbwkide.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.