Risk Management in Smallholder Cattle Farming: A Hypothetical Insurance Approach in Western Kenya

David Jakinda Otieno, Willis Oluoch-Kosura, Joseph Thuo Karugia, Adam G. Drucker and Edward Rege

No 25489, 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia from International Association of Agricultural Economists

Abstract: Smallholder cattle farming is an important livelihood strategy in most developing countries like Kenya. However, tropical diseases in Africa often wipe out these valuable assets. This paper focuses on mitigation of cattle disease risks through a hypothetical insurance scheme. The study is based on data from a survey conducted on a purposive sample of 300 smallholder cattle farmers in Kakamega and Siaya districts of Western Kenya. Descriptive measures and a regression model were used in the analysis. Results of the study showed that most farmers (91.3%) were willing to participate in the cattle insurance scheme. Also, the farmers observed that the scheme would enable them to increase their herd sizes and change their breed composition. The farmer's mean Willingness To Pay (WTP) for the scheme would be determined by their gender, income, cultural norms, cattle breed and economic value/price of the animal kept. This paper recommends establishment of a formal cattle insurance scheme; and economic empowerment of both male and female farmers to encourage adoption of the scheme, as well as educating the farmers on how to integrate the scheme within their cultural norms to ensure it's sustainability.

Keywords: Livestock Production/Industries; Risk and Uncertainty (search for similar items in EconPapers)
Pages: 16
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:ags:iaae06:25489

DOI: 10.22004/ag.econ.25489

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