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Crop Insurance, Premium Subsidy and Agricultural Output

作  者:
Xu Jing-feng;Liao Pu
单  位:
Nankai Univ, Sch Econ, Tianjin 300071, Peoples R China;Cent Univ Finance & Econ, China Inst Actuarial Sci, Beijing 100081, Peoples R China
关键词:
economic growth;agriculture risk;crop insurance;premium subsidy
摘  要:
This paper studied the effects of crop insurance on agricultural output with an economic growth model. Based on Ramsey-Cass-Koopmans (RCK) model, a basic model of agriculture economic growth was developed. Extending the basic model to incorporate uncertainty and insurance mechanism, a risk model and a risk-insurance model were built to study the influences of risk and crop insurance on agricultural output. Compared with the steady states of the three models, the following results are achieved: (i) agricultural output decreases if we introduce uncertainty into the risk-free model; (ii) crop insurance promotes agriculture economic growth if insurance mechanism is introduced into the risk model; (iii) premium subsidy constantly improves agricultural output. Our contribution is that we studied the effects of crop insurance and premium subsidy from the perspective of economic growth in a dynamic framework, and proved the output promotion of crop insurance theoretically.

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