Study Data from Chongqing University Update Understanding of Agricultural Insurance (Optimal Design of Agricultural Insurance Subsidies Under the Risk of Extreme Weather): Agriculture – Agricultural Insurance

2023 SEP 06 (NewsRx) -- By a News Reporter-Staff News Editor at Insurance Daily News -- Investigators publish new report on Agriculture - Agricultural Insurance. According to news originating from Chongqing, People’s Republic of China, by NewsRx correspondents, research stated, “Extreme weather events can pose a significant threat to the agricultural economy, and agricultural insurance serves as an effective tool to mitigate the risk. Motivated by the Chinese government agricultural policies, this study develops two theoretical models to analyze the full-cost insurance and the income insurance, and how should governments design insurance subsidies.”

Financial support for this research came from National Natural Science Foundation of China (NSFC).

Our news journalists obtained a quote from the research from Chongqing University, “Our results show that the government’s optimal insurance subsidies under different insurance formats are closely related to the yield uncertainty and the production efficiency under the risk of extreme weather. When the production efficiency of the farmers is low, regardless of the subsidy level, the sufficient supply of the agricultural products can be guaranteed under full-cost insurance. However, when production efficiency is high, a lower subsidy level should be set under full-cost insurance, while a higher subsidy level is required under income insurance. Moreover, we find the optimal levels of the government insurance subsidies under different insurance formats may not always align with the interests of farmers.”

According to the news editors, the research concluded: “In the extension, we show that the government can maximize social welfare by ensuring the stable supply of agricultural products.”

This research has been peer-reviewed.

For more information on this research see: Optimal Design of Agricultural Insurance Subsidies Under the Risk of Extreme Weather. International Journal of Production Economics, 2023;263. International Journal of Production Economics can be contacted at: Elsevier, Radarweg 29, 1043 Nx Amsterdam, Netherlands. (Elsevier - www.elsevier.com; International Journal of Production Economics - http://www.journals.elsevier.com/international-journal-of-production-economics/)

The news correspondents report that additional information may be obtained from Minyue Jin, Chongqing University, School of Economics and Business Administration, Chongqing, People’s Republic of China. Additional authors for this research include Ling Zhong, Jiajia Nie and Xiaohang Yue.

The direct object identifier (DOI) for that additional information is: https://doi.org/10.1016/j.ijpe.2023.108920. This DOI is a link to an online electronic document that is either free or for purchase, and can be your direct source for a journal article and its citation.

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