Assessing the effects of premium subsidies on crop insurance demand: An analysis for grain production in Southern Brazil

M. Lavorato and Marcelo Braga

No 276025, 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia from International Association of Agricultural Economists

Abstract: Following the well-succeed experience of developed countries such as Canada and the United States, Brazil implemented the Crop Insurance Program (PSR) in 2005 seeking to provide subsidies for the purchase of crop insurance policies by Brazilian farmers. Despite the importance of this public policy, there is no empirical investigation about the effects of premium subsidies on the quantity demanded for crop insurance in Brazil. This paper aimed to fill this gap through the investigation of the three grains – corn, soybeans and wheat – that are most cultivated in southern Brazil, the region where PSR is most developed. A fixed effects model was applied to an unbalanced panel data of municipalities of southern Brazil considering the years between 2006 and 2015. Three measures of crop insurance demand were considered: level of total premiums, level of total premiums per hectare and level of total liability per hectare. Results was in line with previous literature, suggesting the existence of a positive, although inelastic, effect of the subsidy level on the demand for crop insurance.

Keywords: Agricultural and Food Policy; Crop Production/Industries; International Relations/Trade (search for similar items in EconPapers)
Pages: 19
Date: 2018-07
New Economics Papers: this item is included in nep-ias
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:iaae18:276025

DOI: 10.22004/ag.econ.276025

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