Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/190449
Authors: 
Baráth, Lajos
Bokusheva, Raushan
Fertő, Imre
Year of Publication: 
2016
Series/Report no.: 
IEHAS Discussion Papers No. MT-DP - 2016/25
Abstract: 
We hypothesize a reciprocal causation between crop insurance use and the economic performance of farms in an environment characterized by imperfect financial markets and farms' budget constraints. To test our hypothesis, we apply a system of simultaneous equations consisting of economic performance and insurance demand models to the case study of Hungarian cropping farms. In addition, considering that insured farms may have better access to external finance, we seek empirical evidence confirming a potential positive effect of crop insurance on the economic performance of financially constrained farms. Our study results indeed confirm the reciprocal causation hypothesis.
Subjects: 
crop insurance demand
farm productivity
financial constraints
farm investment
Hungarian agriculture
JEL: 
G22
L25
Q12
Q14
ISBN: 
978-615-5594-63-2
Document Type: 
Working Paper

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