Impact of Weather Insurance on Small Scale Farmers: A Natural Experiment
Stephan Dietrich and
Marcela Ibanez
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Stephan Dietrich: Georg-August-University Göttingen
Marcela Ibanez: Georg-August-University Göttingen
No 165, Courant Research Centre: Poverty, Equity and Growth - Discussion Papers from Courant Research Centre PEG
Abstract:
This paper explores the impacts of traditional agricultural insurance that offers protection against climatic shocks on small-scale tobacco farmers in Colombia. We analyze the impacts of access to the insurance on household financial outcomes after a period of severe climatic events that caused substantial crop failures. Our identification strategy benefits from a natural experimental setup of the form in which the insurance was launched. We find that tobacco producers with access to the insurance program were less likely to acquire informal loans, were less likely to use loans to repay debts, and had access to loans with lower interest rates and longer maturation periods. Moreover, access to this program was positively associated with increased savings and accumulation of liquid assets.
Keywords: Insurance; Credit; Natural Disasters; Risk Management; Colombia (search for similar items in EconPapers)
JEL-codes: G22 G23 O13 O16 Q14 (search for similar items in EconPapers)
Date: 2015-02-23
New Economics Papers: this item is included in nep-agr, nep-dev, nep-ias, nep-iue, nep-lam, nep-mfd and nep-rmg
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Persistent link: https://EconPapers.repec.org/RePEc:got:gotcrc:165
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