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Agricultural Risk Management in the European Union: A Proposal to Facilitate Precautionary Savings

Author

Listed:
  • Jean Cordier

    (SMART-LERECO - Structures et Marché Agricoles, Ressources et Territoires - INRA - Institut National de la Recherche Agronomique - AGROCAMPUS OUEST)

  • Marcel von Asseldonk

    (WUR - Wageningen University and Research [Wageningen])

  • Roel Jongeneel

    (WUR - Wageningen University and Research [Wageningen])

  • Cornelis von Kooten

    (WUR - Wageningen University and Research [Wageningen])

Abstract

The article is first assessing the limits of current CAP spendings in stabilizig farm income. Direct payments may have positive or negative wealth effects on farmers' risk behavior and therefore are not a pertinent risk management tool. The dedicated CAP toolbox for risk management, as designed in the 2013-2020 program, is related to deep loss if farm income due to climatic, sanitary or market shocks. The theory of risk layers call for the development of a specific instrument to deal with shallow losses. The article is presenting precautionary savings as an adequate principle that should be supported by national fiscal measures for being operational.

Suggested Citation

  • Jean Cordier & Marcel von Asseldonk & Roel Jongeneel & Cornelis von Kooten, 2019. "Agricultural Risk Management in the European Union: A Proposal to Facilitate Precautionary Savings," Post-Print hal-02293533, HAL.
    • Handle: RePEc:hal:journl:hal-02293533
    DOI: 10.1111/1746-692X.12230
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    References listed on IDEAS

    as
    1. Robert Finger & Niklaus Lehmann, 2012. "The influence of direct payments on farmers’ hail insurance decisions," Agricultural Economics, International Association of Agricultural Economists, vol. 43(3), pages 343-354, May.
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    Cited by:

    1. Ole Boysen & Kirsten Boysen-Urban & Alan Matthews, 2021. "Alternative EU CAP Tools for Stabilising Farm Incomes in the Era of Climate Change," Working Papers 202103, Geary Institute, University College Dublin.
    2. Berkeley Hill & Dylan Bradley, 2021. "Coping with Risks from Natural Disasters on Farms in Wales – Does Insurance Have a Role?," EuroChoices, The Agricultural Economics Society, vol. 20(2), pages 64-69, August.
    3. Ole Boysen & Kirsten Boysen‐Urban & Alan Matthews, 2023. "Stabilizing European Union farm incomes in the era of climate change," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 45(3), pages 1634-1658, September.

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