The Demand for Crop Insurance Combined Approaches for France and Italy
32 Pages Posted: 12 May 2011
Date Written: May 1, 2011
The aim of this paper is to understand which factors affect crop insurance decision in France and in Italy. These neighbor countries are characterized by a changing insurance system from a public fund to private policies highly subsidized. Despite the stakes related to crop insurance – CAP reform, size of the market, implication of the governments, few studies have been drawn on this topic. The literature in finance and in agricultural economics allows to build a two-stage empirical model which computes the elasticities of demand for crop insurance and to define its key determinants. France and Italy present similar insurance systems in terms of products and of ability to indemnify. However, the sensitivity of the farmers to insurance is most contrasted across the Alps. This leads to a discussion about the creation of an insurance market at the European scale.
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