Studies from Guizhou University Yield New Data on Agricultural Insurance (The Influence of the Peer Effect on Farmers’ Agricultural Insurance Decision: Evidence from the Survey Data of the Karst Region in China): Agriculture – Agricultural Insurance

2022 OCT 28 (NewsRx) -- By a News Reporter-Staff News Editor at Insurance Daily News -- Investigators publish new report on agricultural insurance. According to news originating from Guiyang, People’s Republic of China, by NewsRx correspondents, research stated, “Low insurance participation rate and low willingness to insure among farmers have always been major problems in the sustainable development of agricultural insurance in China. This paper attempts to examine the peer effect on farmers’ agricultural insurance buying decisions and explore its mechanism.”

Financial supporters for this research include Rural Revitalization Institute in Karst Region of China, Guizhou University; Department of Education of Guizhou Province.

The news journalists obtained a quote from the research from Guizhou University: “We have established an IVprobit model, using the survey data of 9452 farmers in the karst regions in China. The empirical results show that: (1) Peer effect has a significant influence on farmers’ participation in agricultural insurance. A 10% increase in farmers’ neighbors’ participation in agricultural insurance increases the likelihood of farmers’ participation by 3.25%. (2) Peer effect promotes farmers’ participation by enhancing farmers’ risk perception and insurance cognition. (3) Peer effect is asymmetrical: male and larger-scale farmers have more significant effects on their peers and probably lead the participation in agricultural insurance. The results of the study have the following policy implications: (1) Increasing policy publicity and enforcing policy advocacy would magnify the positive impact of peer effect. (2) Increasing the participation rate of male and larger-scale farmers by policy interventions, which would give full play and a positive demonstration effect of specific groups. (3) Innovating insurance publicity methods to enhance farmers’ risk awareness and insurance cognition.”

According to the news reporters, the research concluded: “(4) More concentration should be focused on the primary-level governance in rural China. We should advance the stock of rural social capital on all fronts to leverage the role of peer effect within rural areas.”

For more information on this research see: The Influence of the Peer Effect on Farmers’ Agricultural Insurance Decision: Evidence from the Survey Data of the Karst Region in China. Sustainability, 2022,14(11922):11922. (Sustainability - http://www.mdpi.com/journal/sustainability). The publisher for Sustainability is MDPI AG.

A free version of this journal article is available at https://doi.org/10.3390/su141911922.

Our news editors report that additional information may be obtained by contacting Guoyong Wu, School of Economics, Guizhou University, Guiyang 550025, People’s Republic of China. Additional authors for this research include Jianwei Cheng, Fan Yang. Our reports deliver fact-based news of research and discoveries from around the world.