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Demand for Complementary Financial and Technological Tools for Managing Drought Risk : Evidence from Rice Farmers in Bangladesh
| Content Provider | Semantic Scholar |
|---|---|
| Author | Spielman, David J. Kumar, Neha Minocha, Sumedha |
| Copyright Year | 2015 |
| Abstract | Financial and technological innovations that mitigate weather-related production risks have the potential to greatly benefit farmers in many risk-prone. In this study we examine farmers’ preferences for two distinct tools that allow them to manage drought risk: weather index insurance and a recently released drought-tolerant rice variety. We illustrate how these tools can independently address drought risk and demonstrate the additional benefits gained by combining them into a complementary risk management product. Findings indicate that farmers are generally unwilling to adopt the drought-tolerant variety independent of insurance, largely due to a yield penalty under nondrought conditions. When bundled with insurance, however, farmers’ valuation of the variety increases. Farmers value insurance on its own, but even more so when bundled with the droughttolerant variety. The results provide evidence that farmers value the complementarities inherent in a well-calibrated bundle of risk management tools. |
| File Format | PDF HTM / HTML |
| Alternate Webpage(s) | http://ageconsearch.umn.edu/record/211909/files/Ward-Demand%20for%20Complementary%20Financial%20and%20Technological%20Tools%20for%20Managing%20Drought%20Risk-404.pdf |
| Alternate Webpage(s) | http://ageconsearch.umn.edu/record/204882/files/AAEA%20-%20Paper%20-%20Demand%20for%20Complementary%20Financial%20and%20Technological%20Tools%20for%20Managing%20Drought%20Risk.pdf |
| Language | English |
| Access Restriction | Open |
| Subject Keyword | Complementarity theory Diffusion of Innovation Droughts Gain Risk management Value (ethics) benefit |
| Content Type | Text |
| Resource Type | Article |
