What trade-off between ex ante protection and ex post compensations in the French reform of agroclimatic insurance?

¿Qué equilibrio debe alcanzarse entre protección ex ante y compensación ex post en la reforma francesa del seguro agroclimático?

Anne Rozan () and Sandrine Spaeter
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Anne Rozan: SAGE - Sociétés, acteurs, gouvernement en Europe - ENGEES - École Nationale du Génie de l'Eau et de l'Environnement de Strasbourg - UNISTRA - Université de Strasbourg - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement
Sandrine Spaeter: BETA - Bureau d'Économie Théorique et Appliquée - AgroParisTech - UNISTRA - Université de Strasbourg - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement

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Abstract: The French agroclimatic risk management reform came into force on 1 January 2023. In this article, we focus on the trade-off between protection and insurance in view of this reform. In a simple model of decision in risk, information on protection decided by the farmer is, successively, private and shared between the parties at stake. In this frame, we determine the conditions that lead to either substituability or complementarity between both actions of protection and insurance decided by the farmer. Contrary to first intuition, we show that a high level of subsidy of the insurance premium by the State makes decrease the farmer's incentives to invest in protection of his cultures, eventhough the insurer takes this investment into account in the insurance premium calculation. Nevertheless, an adequate subsidy rate function that depends on protection investments can be announced by the State such as insurance and protection become complementary activities. We still discuss the issue of sharing the contribution to protection financing between the State and private insurers. Lastly, efficiency of available technologies of protection and optimal rate of subsidy is also debated.

Keywords: Risques agroclimatiques; Assurance privée; Fonds publics; Réforme française; Incitations (search for similar items in EconPapers)
Date: 2024-11-29
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Published in Revue Economique, 2024, 75 (4), pp.641-663. ⟨10.3917/reco.754.0641⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05154771

DOI: 10.3917/reco.754.0641

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