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Home Browse 2021 - Volume 123 Volume 123 - Issue 3

The relationship between crop insurance take-up, technical efficiency, and investment in Hungarian farming

byZUBOR-NEMES, Anna
Reading Time: 1 min read
  • Year 2021
  • Volume 123
  • Issue 3
  • Pages 122-130

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 risk management.

Tags: Data Envelopment Analysisfarm performancerisk managementsystem of simultaneous equations
  • https://doi.org/10.7896/j.2210
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  • Scopus SJR (2021): 0.28
  • Scopus CiteScore (2021): 1.5
  • CitEc Impact Factor: 0.25
  • 5-Year CitEc Impact Factor: 0.44
  • 5-Year CitEc H index: 7
  • ISSN (electronic): 2063-0476
  • ISSN-L 1418-2106

 

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Publisher Name: Institute of Agricultural Economics Nonprofit Kft. (AKI)

Publisher Headquarters: Zsil utca 3-5, 1093-Budapest, Hungary

Name of Responsible Person for Publishing:        Dr. Pal Goda

Name of Responsible Person for Editing:             Dr. Attila Jambor

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This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

The publication cost of the journal is supported by the Hungarian Academy of Sciences.

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Keywords

adoption (5) agricultural exports (3) agriculture (12) CAP (3) Central and Eastern Europe (3) climate change (5) Common Agricultural Policy (3) competitiveness (5) consumer preferences (4) Covid-19 (4) dairy farms (3) Data Envelopment Analysis (3) DEA (2) economic growth (3) efficiency (3) elasticity (3) European Union (7) FADN (3) family farms (4) farmers (3) farmers’ markets (2) farm income (3) Hungary (5) impact evaluation (4) innovation (4) Kosovo (3) LEADER (4) maize (3) market size (2) Nigeria (2) off-farm income (4) participation (3) policy (4) price (2) price transmission (2) risk management (3) rural areas (4) rural development (13) social capital (3) social innovation (3) Structural Funds (3) sustainability (5) sustainable agriculture (4) technical efficiency (5) theory of planned behaviour (2)
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