Revenue Insurance and Chemical Input Use Rates

Using farm level data and a simultaneous probit model we evaluate the input use and environmental effects of revenue insurance. A priori, the moral hazard effect on input use is indeterminate and this study empirically assesses the input use impact of the increasingly popular, and federally subsidized, risk management instrument of revenue insurance. We conclude that the moral hazard effect of federally subsidized revenue insurance products induces U.S. wheat farmers to increase expenditures on pesticides and reduce expenditures on fertilizers.


Issue Date:
2001
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/20669
Total Pages:
26
Series Statement:
Selected Paper




 Record created 2017-04-01, last modified 2017-08-24

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