Financial intermediaries [FIs] in developing and emerging economies are poorly equipped to manage natural disasters. These events create losses for FIs, eroding capital reserves and compromising their ability to lend. Portfolio-level insurance against disasters can improve FI management of these...

Financial intermediaries [FIs] in developing and emerging economies are poorly equipped to manage natural disasters. These events create losses for FIs, eroding capital reserves and compromising their ability to lend. Portfolio-level insurance against disasters can improve FI management of these...

Weather index insurance underwrites a weather risk, typically highly correlated with agricultural production losses, as a proxy for economic loss and is gaining popularity in lower income countries. This instrument, although subject to basis risk and high start-up costs, should reduce costs over...

Purpose – This paper illustrates that natural disasters can significantly threaten financial institutions serving the poor. The authors test the case of a microfinance institution (MFI) in Northern Peru, where severe El Niño events create catastrophic flooding. Design/methodology/approach –...

Replaced by updated/revised version. This is an electronic version of a journal article, please cite as: Collier, B., A.L. Katchova, and J. Skees. “Loan Portfolio Performance and El Nino, an Intervention Analysis.” Agricultural Finance Review 71(2011):98-119.

We study a manufacturer's strategic use of a dual-sourcing option when facing suppliers who possess private information about their likelihood of experiencing a supply disruption. The manufacturer can diversify its supply by ordering from both suppliers, but we find that the cost of doing so is...

This paper analyzes a unit-contingent power purchase agreement between an electricity distributor and a power plant. Under such a contract the distributor pays the plant a fixed price if the plant is operational and nothing if plant outage occurs. Pricing a unit-contingent contract is...