Agricultural Insurance and Economic Development

Posted: 14 Aug 2017

See all articles by Shawn Allen Cole

Shawn Allen Cole

Harvard Business School

Wentao Xiong

Harvard University

Date Written: August 2017


This article provides a review of recent research on agricultural insurance (AI) in developing countries. Agricultural producers face a variety of significant risks; historically, only government-subsidized products have achieved widespread adoption. A recent contractual innovation, which links insurance payouts to realized weather rather than farmer indemnity, has spurred substantial research in the past decade. This review begins by describing the experience in developed economies and then turns to developing countries, covering the following topics: farmers' adoption of AI, how AI affects their decision to invest in risky assets, and the extent to which AI helps farmers smooth income and consumption. We conclude with suggestions for future research and practice related to AI in developing countries.

Suggested Citation

Cole, Shawn Allen and Xiong, Wentao, Agricultural Insurance and Economic Development (August 2017). Annual Review of Economics, Vol. 9, pp. 235-262, 2017. Available at SSRN: or

Shawn Allen Cole (Contact Author)

Harvard Business School ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

Wentao Xiong

Harvard University

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