Can Crop Insurance Encourage Farmers to Adopt Environmentally Friendly Agricultural Technology—The Evidence from Shandong Province in China

Tengda Wei, Ye Liu, Ke Wang and Qiao Zhang
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Tengda Wei: Agricultural Information Institute, Chinese Academy of Agricultural Science, No. 12 Zhongguancun South Street, Haidian District, Beijing 100081, China
Ye Liu: Agricultural Information Institute, Chinese Academy of Agricultural Science, No. 12 Zhongguancun South Street, Haidian District, Beijing 100081, China
Ke Wang: Agricultural Information Institute, Chinese Academy of Agricultural Science, No. 12 Zhongguancun South Street, Haidian District, Beijing 100081, China
Qiao Zhang: Agricultural Information Institute, Chinese Academy of Agricultural Science, No. 12 Zhongguancun South Street, Haidian District, Beijing 100081, China

Sustainability, 2021, vol. 13, issue 24, 1-15

Abstract: It is critical to encourage farmers to adopt agriculture technology that is beneficial to the environment in the context of the ongoing emphasis on the ecological growth of agriculture, yet risk and uncertainty diminish the incentive to adopt these technologies. This research examines whether crop insurance might affect and increase willingness to adopt Environmentally Friendly Agricultural Technology (EFAT) from a psychological perspective, utilizing data from 219 questionnaires in Shandong Province. The findings suggest that crop insurance can boost readiness to embrace technology in three ways: motivation, ability, and opportunity; however, the positive effect of motivation on farmers diminishes as capacity increases. Insurance companies must offer products that contain the risk of adopting EFAT as an insurance obligation as soon as feasible to successfully boost willingness to use technologies and collaborate with agricultural technology departments to provide farmers with training as well as disaster avoidance services.

Keywords: agricultural technology; crop insurance; structural formula; MOA theory (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
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