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| Content Provider | AgEcon Search |
|---|---|
| Author | Veselinović, Janko Markovic, Todor Đukić, Stanimir |
| Editor | Cvijanovic, Drago |
| Abstract | Weather derivatives are not present in Serbia nor in the neighbouring countries andhave no significant application in the European Union, either. Weather derivativesoriginated in the USA, where the market for these instruments is most developed, interms of both economy and law. However, positive effects of their application, throughthe decrease of influence of unfavourable weather conditions on agricultural crops, area good basis for their further study. The most common reasons for their absence fromour financial market are their complexity and the inexistence of prerequisites for theirintroduction. This paper analyses legal and economic aspects of weather derivatives, asforms of financial derivatives, as well as weather derivative contracts concluded withthe aim of hedging against precipitation exposure. The goal of the analysis is to find anoptimal contract structure, but also the conditions that have to be met in order for itssigning to be economically justified for both contractual parties, as well as the creationof preconditions for this weather derivative contract to be the instrument of trade onthe financial market. The paper also analyses normative frameworks for the conclusionof these derivative contracts, as well as the necessity to educate market participants, which refers both to agricultural producers and financial institutions. Furthermore,it emphasizes the difference in relation to the classical contract of insurance againstdrought risk. |
| Related Links | https://ageconsearch.umn.edu/record/196704/files/16%20EP%204%202014.pdf |
| Ending Page | 1067 |
| Page Count | 15 |
| Starting Page | 1053 |
| File Format | |
| ISSN | 03523462 |
| DOI | 10.22004/ag.econ.196704 |
| Journal | Economics of Agriculture |
| Issue Number | 4 |
| Volume Number | 61 |
| Language | English |
| Publisher | Institute of Agricultural Economics (IAE), Belgrade - Serbia |
| Publisher Date | 2014-01-01 |
| Access Restriction | Open |
| Subject Keyword | Applied Economics Agricultural Economics Agri-economic Open Access Database Research in Applied Economics Research in Agricultural Economics Higher Study On Agricultural Economics Higher Study On Applied Economics Agricultural Research Documents Agrarian Economy & Research Higher Study Agri-economics Research in Economics Agri-economic Open Access Repository Statistics in Agricultural Economics Hedging Strategies Precipitation Quantity Weather Derivatives Agribusiness Agricultural Finance |
| Alternative Title | ANALIZA PRAVNIH I EKONOMSKIH ASPEKATA VREMENSKIH DERIVATA KOD PADAVINA U SRBIJI U POLJOPRIVREDNOJ OBLASTI |
| Content Type | Text |
| Resource Type | Article |
| Subject | Economics, Econometrics and Finance |
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