We estimate actuarially fair premium rates for yield and revenue insurance for Georgia and South Carolina peaches. The premium rates for both products decrease at a decreasing rate as the mean farm-level yield increases. In general, the premium rate for revenue insurance exceeds the premium rate...

We estimate actuarially fair premium rates for yield insurance for Georgia and South Carolina peaches for comparison to the premium rates established by the Risk Management Agency (RMA) for the 1999 crop. The RMA premium rates varied from county to county, but were identical for all growers in a...

We estimate actuarially sound premium rates for individual yield guarantee and income protection crop insurance products for Georgia and South Carolina peaches. In most cases, the premium rate for an income protection product equals or exceeds the premium rate for an individual yield guarantee...

This research evaluates whether or not hedging strategies using call options on the New York Board of Trade cotton futures can be effectively used to protect the new counter-cyclical payment on cotton. Results indicate that some level of counter-cyclical payment hedging is optimal for risk...

Considerable disagreement exists about the most appropriate characterization of farm-level yield distributions. Yet, the economic importance of alternate yield distribution specifications on insurance valuation, product designs and farm-level risk management has not been investigated or...

Weather conditions pose unique risks to dairy producers. Weather derivatives represent a potentially promising approach to augment dairy producers' risk management against adverse weather events. This study examines the effect of basis risk in weather derivatives, and whether the existence of...

This paper discusses some of the failings of expected utility including the Allais paradox and expected utility's inadequate one dimensional characterization of risk. Three alternatives to expected utility are discussed at length; weighted expected utility, rank dependent utility, and cumulative...

The vast majority of previous studies on farmers' optimal risk management behavior have used static models and on the most part ignored use of borrowing and lending as an alternative method of managing risk In this paper we develop a stylized multi-period risk management model for a risk averse...

Accurate pricing of weather derivatives is critically dependent upon correct specification of the underlying weather process. We test among six likely alternative processes using maximum likelihood methods and data from the Fresno, CA weather station. Using these data, we find that the best...