IDEAS home Printed from https://ideas.repec.org/p/ags/saeana/46834.html
   My bibliography  Save this paper

Climate Effects on Rainfall Index Insurance Purchase Decisions

Author

Listed:
  • Novak, James L.
  • Nadolnyak, Denis A.

Abstract

Rainfall Index insurance is a pilot insurance product offered to producers of hay and pasture in 9 states. This analysis examines the expected payoff of the RI insurance for bi-monthly periods based on rainfall shortage probabilities in alternative climate phases. Differences in expected returns indicate that selection of ENSO-specific optimal intervals may result in higher returns than those based on pooled rainfall series.

Suggested Citation

  • Novak, James L. & Nadolnyak, Denis A., 2008. "Climate Effects on Rainfall Index Insurance Purchase Decisions," 2009 Annual Meeting, January 31-February 3, 2009, Atlanta, Georgia 46834, Southern Agricultural Economics Association.
  • Handle: RePEc:ags:saeana:46834
    DOI: 10.22004/ag.econ.46834
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/46834/files/SAEA09.pdf
    Download Restriction: no

    File URL: https://libkey.io/10.22004/ag.econ.46834?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. Miguel Carriquiry & Daniel E. Osgood, 2008. "Index Insurance, Probabilistic Climate Forecasts, and Production," Center for Agricultural and Rural Development (CARD) Publications 08-wp465, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    2. James W. Mjelde & Harvey S.J. Hill & John F. Griffiths, 1998. "A Review of Current Evidence on Climate Forecasts and Their Economic Effects in Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(5), pages 1089-1095.
    3. Denis Nadolnyak & Dmitry Vedenov & James Novak, 2008. "Information Value of Climate-Based Yield Forecasts in Selecting Optimal Crop Insurance Coverage," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 90(5), pages 1248-1255.
    4. Martin, Steven W. & Barnett, Barry J. & Coble, Keith H., 2001. "Developing And Pricing Precipitation Insurance," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 26(1), pages 1-14, July.
    5. Podesta, Guillermo & Letson, David & Messina, Carlos & Royce, Fred & Ferreyra, R. Andres & Jones, James & Hansen, James & Llovet, Ignacio & Grondona, Martin & O'Brien, James J., 2002. "Use of ENSO-related climate information in agricultural decision making in Argentina: a pilot experience," Agricultural Systems, Elsevier, vol. 74(3), pages 371-392, December.
    6. Mario J. Miranda, 1991. "Area-Yield Crop Insurance Reconsidered," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 73(2), pages 233-242.
    Full references (including those not matched with items on IDEAS)

    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. Nadolnyak, Denis A. & Novak, James L. & Vedenov, Dmitry V. & Paz, Joel O. & Fraisse, Clyde W. & Hoogenboom, Gerrit, 2007. "Non-Parametric Analysis of ENSO Impacts on Yield Distributions: Implications for GRP Contract Design," 2007 Annual Meeting, February 4-7, 2007, Mobile, Alabama 34858, Southern Agricultural Economics Association.
    2. Juárez-Torres, Miriam & Sánchez-Aragón, Leonardo & Vedenov, Dmitry, 2017. "Weather Derivatives and Water Management in Developing Countries: An Application for an Irrigation District in Central Mexico," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 42(2), May.
    3. Patrick S. Ward & David L. Ortega & David J. Spielman & Neha Kumar & Sumedha Minocha, 2020. "Demand for Complementary Financial and Technological Tools for Managing Drought Risk," Economic Development and Cultural Change, University of Chicago Press, vol. 68(2), pages 607-653.
    4. Carter, Chris & Crean, Jason & Kingwell, Ross S. & Hertzler, Greg, 2006. "Managing and Sharing the Risks of Drought in Australia," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25319, International Association of Agricultural Economists.
    5. Turvey, Calum G., 1999. "Weather Derivatives And Specific Event Risk," 1999 Annual meeting, August 8-11, Nashville, TN 21550, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    6. Cabrera, Victor E. & Letson, David & Podesta, Guillermo, 2007. "The value of climate information when farm programs matter," Agricultural Systems, Elsevier, vol. 93(1-3), pages 25-42, March.
    7. Novak, James L. & Nadolnyak, Denis A., 2010. "Climate Effects on Rainfall Index Insurance Purchase Decisions," Journal of the ASFMRA, American Society of Farm Managers and Rural Appraisers, vol. 2010, pages 1-13.
    8. Hansen, James W., 2002. "Realizing the potential benefits of climate prediction to agriculture: issues, approaches, challenges," Agricultural Systems, Elsevier, vol. 74(3), pages 309-330, December.
    9. Bert, Federico E. & Satorre, Emilio H. & Toranzo, Fernando Ruiz & Podesta, Guillermo P., 2006. "Climatic information and decision-making in maize crop production systems of the Argentinean Pampas," Agricultural Systems, Elsevier, vol. 88(2-3), pages 180-204, June.
    10. Cao, Juan & Zhang, Zhao & Tao, Fulu & Chen, Yi & Luo, Xiangzhong & Xie, Jun, 2023. "Forecasting global crop yields based on El Nino Southern Oscillation early signals," Agricultural Systems, Elsevier, vol. 205(C).
    11. Andrea Bastianin & Alessandro Lanza & Matteo Manera, 2018. "Economic impacts of El Niño southern oscillation: evidence from the Colombian coffee market," Agricultural Economics, International Association of Agricultural Economists, vol. 49(5), pages 623-633, September.
    12. Jesse B. Tack & David Ubilava, 2015. "Climate and agricultural risk: measuring the effect of ENSO on U.S. crop insurance," Agricultural Economics, International Association of Agricultural Economists, vol. 46(2), pages 245-257, March.
    13. Chen, Shu-Ling & Miranda, Mario J., 2006. "Modeling Yield Distribution In High Risk Counties: Application To Texas Upland Cotton," 2006 Annual meeting, July 23-26, Long Beach, CA 21392, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    14. 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.
    15. Adhikari, Shyam & Knight, Thomas O. & Belasco, Eric J., 2012. "Evaluation of Crop Insurance Yield Guarantees and Producer Welfare with Upward-Trending Yields," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 41(3), pages 1-10, December.
    16. Jesse Tack & David Ubilava, 2013. "The effect of El Niño Southern Oscillation on U.S. corn production and downside risk," Climatic Change, Springer, vol. 121(4), pages 689-700, December.
    17. Glauber, Joseph W., 2017. "Agricultural insurance and the WTO:," IFPRI book chapters, in: Bouët, Antoine & Laborde Debucquet, David (ed.), Agriculture, development, and the global trading system: 2000– 2015, chapter 10, International Food Policy Research Institute (IFPRI).
    18. 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.
    19. Yong Liu & A. Ford Ramsey, 2023. "Incorporating historical weather information in crop insurance rating," American Journal of Agricultural Economics, John Wiley & Sons, vol. 105(2), pages 546-575, March.
    20. Paulson, Nicholas D. & Babcock, Bruce A., 2008. "Get a Grip: Should Area Revenue Coverage Be Offered Through the Farm Bill or as a Crop Insurance Program?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 33(2), pages 1-17.

    More about this item

    Keywords

    Production Economics; Risk and Uncertainty;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    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:ags:saeana:46834. 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: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/saeaaea.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.