Climate change is putting increasing pressure on agriculture, which might be reduced by paying more attention to risk management, production efficiency and farm investment. This paper describes the interrelationship between crop insurance take-up, technical efficiency and investment in Hungarian farming using a system of simultaneous equations. The empirical analysis is based on farm accountancy data for the period 2001-2019. Results suggest that both technical efficiency and investment have positive and significant effects on insurance take-up. Accordingly, higher technical efficiency and a higher investment rate both lead to increased insurance usage. In terms of its relationship with efficiency, insurance has a positive and significant coefficient, but investment does not have a significant influence on technical efficiency. Where investment is concerned, insurance usage has a positive and significant effect, but the role of technical efficiency is insignificant. Results suggest that policy interventions that stimulate any of the three factors can potentially have additional positive impacts through spill-over effects on other factors. These effects could be further enhanced if, for instance, interventions focusing primarily on insurance take-up also pay attention to investment by differentiating insurance premium subsidies, depending on whether there is an ongoing (or operating) investment that can be linked to weather-related...

Hungarian cereal production is situated in the zone of Europe which is most vulnerable to the effects of changes in climatic conditions. The objectives of this paper are to present the calibration and validation of the 4M crop simulation model using farm-level observed representative values, and to estimate the potential yields of winter wheat and maize production for the next three decades. Analysing the differences between the estimated and observed yields, we identified as key influencing factors the heterogeneity of technologies and of land quality. A trend of slightly decreasing yields is projected for the next three decades for both cereals. The precise impact of environmental change on crop yields will depend on which climate scenario occurs.