Studying Farm Insurance Demand under Financial Constraints

Baráth, Lajos and Bokhuseva, Raushan and Fertő, Imre (2016) Studying Farm Insurance Demand under Financial Constraints. Műhelytanulmányok = Discussion Papers (MT-DP ). Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences, Budapest. ISBN 978-615-5594-63-2

Preview

Text MTDP1625.pdf Download (637kB) | Preview

Abstract

We hypothesize a reciprocal causation between crop insurance use and the economic performance of farms in an environment characterized by imperfect financial markets and farms’ budget constraints. To test our hypothesis, we apply a system of simultaneous equations consisting of economic performance and insurance demand models to the cas e study of Hungarian cropping farms. In addition, considering that insured farms may have better access to external finance, we seek empirical evidence confirming a potential positive effect of crop insurance on the economic performance of financially cons trained farms. Our study results indeed confirm the reciprocal causation hypothesis.

Actions (login required)

Edit Item