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1 – 10 of over 3000Mohammad Shakhawat Hossain, Lu Qian, Muhammad Arshad, Shamsuddin Shahid, Shah Fahad and Javed Akhter
Changes in climate may have both beneficial and harmful effects on crop yields. However, the effects will be more in countries whose economy depends on agriculture. This study…
Abstract
Purpose
Changes in climate may have both beneficial and harmful effects on crop yields. However, the effects will be more in countries whose economy depends on agriculture. This study aims to measure the economic impacts of climate change on crop farming in Bangladesh.
Design/methodology/approach
A Ricardian model was used to estimate the relationship between net crop income and climate variables. Historical climate data and farm household level data from all climatic zones of Bangladesh were collected for this purpose. A regression model was then developed of net crop income per hectare against long-term climate, household and farm variables. Marginal impacts of climate change and potential future impacts of projected climate scenarios on net crop incomes were also estimated.
Findings
The results revealed that net crop income in Bangladesh is sensitive to climate, particularly to seasonal temperature. A positive effect of temperature rise on net crop income was observed for the farms located in the areas having sufficient irrigation facilities. Estimated marginal impact suggests that 1 mm/month increase in rainfall and 10°C increase in temperature will lead to about US$4-15 increase in net crop income per hectare in Bangladesh. However, there will be significant seasonal and spatial variations in the impacts. The assessment of future impacts under climate change scenarios projected by Global Circulation Models indicated an increase in net crop income from US$25-84 per hectare in the country.
Research limitations/implications
The findings of this study indicate the need for development practitioners and policy planners to consider both the beneficial and harmful effects of climate change across different climatic zones while designing and implementing the adaptation policies in the country.
Originality/value
Literature survey of the Web of Science, Science Direct and Google Scholar indicates that this study is the first attempt to measure the economic impacts of climate change on overall crop farming sector in Bangladesh using an econometric model.
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Dermot J. Hayes, Sergio H. Lence and Chuck Mason
This study estimates the probability density function of the government’s net income from reinsuring crop insurance for corn, wheat, and soybeans. Based on 1997 data, it is…
Abstract
This study estimates the probability density function of the government’s net income from reinsuring crop insurance for corn, wheat, and soybeans. Based on 1997 data, it is estimated there is a 5% probability that the government will need to reimburse at least $1 billion to insurance companies, and that the fair value of the government’s reinsurance services to insurance firms equals $78.7 million. In addition, various hedging strategies are examined for their potential to reduce the government’s reinsurance risk. The risk reduction achievable by hedging is appreciable, but use of derivative contracts alone is clearly no panacea.
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Alhassane Camara, Anatole Goundan, Christian Henning, Luc Savard and Assane Beye
There is much evidence in the literature showing the benefits of input market participation on farmers’ welfare. The same is true for participation in marketing. However, there…
Abstract
Purpose
There is much evidence in the literature showing the benefits of input market participation on farmers’ welfare. The same is true for participation in marketing. However, there are very few studies on the expected benefit of input market participation and marketing. This study fills this gap by examining the issue in the Senegalese context for food and cash crops.
Design/methodology/approach
The authors estimate a multinomial endogenous switching regression using a highly detailed 2017 agricultural survey in Senegal. They first identify factors that shape farmers’ decision to participate in the input market and marketing and then assess the impact of market participation choices on farmers’ profits.
Findings
The results show that the most profitable market participation regime depends on the crop under consideration. For food crops, joint participation in markets maximizes profit per hectare, while for groundnuts, the main cash crop in Senegal, participation in the input market is not necessary to maximize farm profit.
Research limitations/implications
Using panel data would improve the quality of estimations (time-variant effects) and help to consider the role of risk in output and input markets.
Originality/value
This paper helps to characterize different profiles of farmers based on their market participation and crop choices and provide policymakers with recommendations for maximizing farmers’ profit.
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Cory Walters and Richard Preston
At the beginning of the production year producers face a complex risk management decision environment given by risks specific to their operation, multiple crop insurance contracts…
Abstract
Purpose
At the beginning of the production year producers face a complex risk management decision environment given by risks specific to their operation, multiple crop insurance contracts and hedging opportunities. The purpose of this paper is to provide a producer-level framework for risk management decision making, focusing on the interaction between crop insurance and hedging.
Design/methodology/approach
The authors develop a Monte Carlo simulation model that generates a producer’s net income (NI) distribution that incorporates historical producer risk, price-yield correlation via a copula, price risk, and production costs. The authors evaluate the NI distribution through a modified Modern Portfolio Theory (MPT) decision framework. The authors use the modified MPT decision framework to explore tradeoffs between expected NI and farm ruin (defined as 1 or 5 percent expected shortfall) from different crop insurance contracts and pre-harvest hedging options.
Findings
Only revenue protection and the highest two levels of coverage level exist on the efficient frontier. The level of hedging on the efficient frontier ranges from 0 to 55 percent of Actual Production History. The authors find that increasing coverage level 5 percent (from 80 to 85 percent) negatively impacts the optimal hedging amount by 26 percentage points (from 35 to 9 percent).
Originality/value
The model provides the precise identification of financial benefits from different risk management strategies by incorporating producer-level historical yield data, using a copula to capture yield-price dependency structure and producer production cost in generating the NI distribution. This model can be applied to any producer’s characteristics and data.
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Teresa Serra, Barry K. Goodwin and Allen M. Featherstone
The crop insurance purchase decision for a group of Kansas farmers is analyzed using farm‐level data from the 1990s, a period that experienced many changes in the federal crop…
Abstract
The crop insurance purchase decision for a group of Kansas farmers is analyzed using farm‐level data from the 1990s, a period that experienced many changes in the federal crop insurance program. Results indicate a reduction in the elasticity of the demand for crop insurance with respect to premium rates by the end of the decade. The reduction in demand elasticity corresponded with a considerable increase in government subsidies by the end of the 1990s. This result may also reflect the attractiveness of new revenue insurance products which may have made producers less sensitive to premium changes.
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Constructing a low-carbon agriculture (LCA) park is considered an effective means to reduce greenhouse gas (GHG) emissions in developing countries. This study aims to explore the…
Abstract
Purpose
Constructing a low-carbon agriculture (LCA) park is considered an effective means to reduce greenhouse gas (GHG) emissions in developing countries. This study aims to explore the effectiveness of integrated low-carbon agricultural technologies based on evidence from a pilot LCA experiment in Shanghai, China, from 2008 to 2011.
Design/methodology/approach
Integrated low-carbon technologies in an agricultural park were adopted to reduce GHG emissions. Reduced emissions and net economic benefits were calculated by comparing emissions before and after the implementation of the experiment.
Findings
Results show that the low-carbon agricultural park experiment markedly reduced GHG emissions. This outcome can be attributed to the integrated technologies adopted in the experiment, including the reuse and recycle of resources, control of environmental pollution and GHG emissions and improvement of economic efficiency and social benefit. All the technologies adopted are already available and mature, thus indicating the great potential of LCA to reduce GHG emissions despite the lack of advanced technologies. However, supporting policies may be necessary to motivate private interests in LCA because of the considerable starting investments.
Originality/value
Previous macro-level and policy studies on LCA are based on knowledge from experimental studies, which typically specify environmental conditions to explore solely the effects of one low-carbon technology. Practically, integrating several low-carbon technologies in one experiment may be more effective, particularly for extensive agriculture, in developing countries. The effectiveness of integrated technologies is insufficiently discussed in the literature. Therefore, this study explores how effective integrated feasible LCA technologies can be in terms of both emission reduction and economic benefits based on the data obtained from an experiment in Shanghai, China.
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Farmers are the largest group of financially excluded persons in Nigeria, thereby highlighting the supply shortfall in finance to agriculture in Nigeria. Availability of finance…
Abstract
Purpose
Farmers are the largest group of financially excluded persons in Nigeria, thereby highlighting the supply shortfall in finance to agriculture in Nigeria. Availability of finance would go a long way in improving output and productivity in agriculture, and consequently help in reducing poverty. This study conducts an empirical investigation of the effects of financial inclusion on agricultural productivity in Nigeria.
Design/methodology/approach
This study makes use of the Living Standards Measurement Study–Integrated Surveys on Agriculture (LSMS-ISA). This is a new data set on agricultural households which contains information on agricultural activities and various household activities, including banking, savings and insurance behaviour. Considering the data are such that there are observations for households over three time periods, the study exploits the time series and cross-section dimension of the data by using panel data estimation.
Findings
The empirical results of the study show that financial inclusion, irrespective of how it is measured, has exerted positive and statistically significant effects on agricultural productivity in Nigeria.
Originality/value
While considerable research has been conducted to examine how finance affects broad macroeconomic aggregates, little is known about the effects of finance at the household and individual level. It is important to explicitly account for financial inclusion when examining the effects of finance on individuals and households. This study improves on existing research and offers new insights into the effects of financial inclusion on the economic activities of agricultural households in Nigeria.
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Min Li and Terry Sicular
The purpose of this paper is to analyze the extent of aging in the agricultural labor force and its effect on farm production in a province of China.
Abstract
Purpose
The purpose of this paper is to analyze the extent of aging in the agricultural labor force and its effect on farm production in a province of China.
Design/methodology/approach
The analysis uses panel data for the years 2004 through 2008 from a representative sample of farm households in Liaoning province. Descriptive statistics reveal the age structure of the agricultural labor force and correlations between labor force age and production characteristics. A translog stochastic frontier production function and technical inefficiency model is employed to analyze the effect of aging of the labor force on the technical efficiency of crop production.
Findings
The paper finds an accelerating trend towards aging of the agricultural labor force in the data. Results from the stochastic frontier production function and efficiency analysis reveal that household‐level technical efficiency increases until maximum efficiency is reached when the average age of the household labor force is 45, after which efficiency declines.
Practical implications
Aging of China's rural labor force may affect efficiency and productivity in crop production. Agricultural policies may need to pay more attention to the aging of the agricultural labor force. Some measures should be taken to address the pattern of migration, and policies to improve the social and economic environment in rural areas for younger workers should be developed. Also, extension programs could help older farmers to maintain efficient farming methods.
Originality/value
This is one of very few analyses of the effects of aging on production efficiency for a developing country, as well as for China. The analysis uses a unique panel dataset that covers 24 counties, 1,890 rural households, and more than 6,000 individuals, with each household tracked for five years. Most of the literature estimating technical efficiency carries out the analysis at the individual level; in China and other developing countries, farming is carried out at the household level. We have adapted the methodology to apply to situations where the unit of analysis is the household.
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Madhav Regmi, Allen M. Featherstone and Jesse Tack
Federally subsidized crop insurance aims to mitigate farm risks of crop producers. A body of literature has examined informational problems under this program. However, few…
Abstract
Purpose
Federally subsidized crop insurance aims to mitigate farm risks of crop producers. A body of literature has examined informational problems under this program. However, few studies empirically link crop insurance participation with farm financial performance. Most use county-level aggregates to argue that crop insurance participation is associated with increased farm financial debt. Using farm-level data, this study provides empirical evidence of crop insurance's effects on farm financial risk.
Design/methodology/approach
The impact of crop insurance on farm financial risks is assessed using farm-level data from Kansas. The sample consists of at least 1,600 farms each year from 2002 to 2015. Financial risks are measured using the probability of falling into the critical zone of five different financial ratios. The study uses two matching estimators to estimate the causal effects of crop insurance participation on farm financial risks. Several alternative empirical approaches account for unobserved heterogeneity and potential endogeneity.
Findings
Crop insurance participation has reduced the farm's likelihood of being in the critical liquidity risk by 8%. This result is robust across matching estimators and alternative specifications to account for unobserved heterogeneity and potential endogeneity.
Originality/value
This is one of the few studies to examine whether crop insurance reduces farm financial risks. This study provides empirical evidence of the extent to which crop insurance enrollment impacts farm financial risks. Findings suggest that crop insurance is critical to maintaining the financial well-being of crop producers, and significantly reduces the likelihood of producers being in a critical liquidity risk.
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Nhat Lam Duyen Tran, Roberto F. Rañola,, Bjoern Ole Sander, Wassmann Reiner, Dinh Tien Nguyen and Nguyen Khanh Ngoc Nong
In recent years, climate-smart agriculture (CSA) was introduced to Vietnam to enhance farmers’ resilience and adaptation to climate change. Among the climate-smart agricultural…
Abstract
Purpose
In recent years, climate-smart agriculture (CSA) was introduced to Vietnam to enhance farmers’ resilience and adaptation to climate change. Among the climate-smart agricultural technologies (CSATs) introduced were water-saving techniques and improved stress tolerant varieties. This study aims to examine the determinants of farmers’ adoption of these technologies and the effects of their adoption on net rice income (NRI) in three provinces as follows: Thai Binh (North), Ha Tinh (Central) and Bac Lieu (South).
Design/methodology/approach
Determinants of adoption of CSATs and the adoption effects on NRI are analyzed by using a multinomial endogenous switching regression framework.
Findings
The results showed that gender, age, number of family workers, climate-related factors, farm characteristics, distance to markets, access to climate information, confidence on the know-how of extension workers, membership in social/agricultural groups and attitude toward risk were the major factors affecting the decision to adopt CSATs. However, the effects of these factors on the adoption of CSATs varied across three provinces. These technologies when adopted tend to increase NRI but the increase is much greater when these are combined.
Practical implications
It is important to consider first the appropriateness of the CSA packages to the specific conditions of the target areas before they are promoted. It is also necessary to enhance the technical capacity of local extension workers and provide farmers more training on CSATs.
Originality/value
This study is the first attempt to identify key determinants of adoption of CSATs either singly or in combination and the adoption effects on NRI in Vietnam.
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