Small Farmers' Preferences for Weather Index Insurance: Insights from Kenya

Kenneth W. Sibiko, Prakashan Chellattan Veettil () and Matin Qaim

No 256213, GlobalFood Discussion Papers from Georg-August-Universitaet Goettingen, GlobalFood, Department of Agricultural Economics and Rural Development

Abstract: Smallholder farmers in developing countries are particularly vulnerable to climate shocks but often lack access to insurance. Weather index insurance (WII) is a promising innovation, but uptake has been lower than expected. WII contracts are not yet sufficiently tailored to the needs and preferences of smallholders. We combine survey and choice-experimental data from Kenya to analyze an existing WII program and how changes in contractual design might encourage uptake. Better training, higher levels of transparency, and offering contracts to small groups rather than individual farmers would increase willingness to pay. Basis risk does not seem to be a major constraint.

Keywords: Community/Rural/Urban Development; Farm Management; Risk and Uncertainty (search for similar items in EconPapers)
Pages: 33
Date: 2017-04-01
New Economics Papers: this item is included in nep-dcm, nep-env and nep-ias
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Citations: View citations in EconPapers (2)

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Working Paper: Small Farmers’ Preferences for Weather Index Insurance: Insights from Kenya (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:gagfdp:256213

DOI: 10.22004/ag.econ.256213

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