An attempt to modelling revenue insurance schemes at the farm level by means of Positive Mathematical Programming

Simone Severini and Raffaele Cortignani

No 99431, 122nd Seminar, February 17-18, 2011, Ancona, Italy from European Association of Agricultural Economists

Abstract: Farmers face increasing income uncertainty and the debate is growing on the role of insurance schemes and of public support in this field. This paper applies a PMP modelling approach that takes into explicit consideration risk aversion behaviour to test its applicability to evaluating the potential impact of insurance schemes. This is done by introducing a revenue insurance scheme into a model developed on a small group of crop farms in Italy. The paper represents a preliminary assessment of the soundness of the proposed approach. It identifies some limitations that should be overcome to improve the proposed approach. Despite these limitations, it seems a useful tool to investigate the impact of insurance schemes and policy relevant parameters such as premium and coverage rates. Indeed, it permits the assessment of how this affects production choices, farm profitability and the impact of public support to reduce the net premium paid by farmers.

Keywords: Agricultural; and; Food; Policy (search for similar items in EconPapers)
Pages: 17
Date: 2011-02-10
New Economics Papers: this item is included in nep-agr and nep-ias
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:eaa122:99431

DOI: 10.22004/ag.econ.99431

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