Observatorio de I+D+i UPM

Memorias de investigación
Research Publications in journals:
Comparison of Different Water Supply Risk Management Tools for Irrigators: Option Contracts and Insurance
Year:2015
Research Areas
  • Agriculture,
  • Agricultural economics
Information
Abstract
Irrigators must cope with the risk of not having enough water to meet crop demands. There are different tools for managing this risk, including water market mechanisms and insurance. Given the choice, farmers will opt for the tool that offers the greatest positive change in expected utility. This paper presents a theoretical assessment of farmers? expected utility for two different water option contracts and a drought insurance policy. We analyze the conditions that determine farmers? preferences for these instruments and perform a numerical application to a water-stressed Spanish region. Results show that farmers? willingness to pay for the considered risk management tools are greater than the preliminary estimates of these instruments costs. This suggests that option contracts and insurance may help farmers manage water supply availability risks.
International
Si
JCR
No
Title
Environmental and Resource Economics
ISBN
0924-6460
Impact factor JCR
1,426
Impact info
Volume
April 2015
10.1007/s10640-015-9912-2
Journal number
From page
1
To page
25
Month
SIN MES
Ranking
Participants
  • Autor: D. Rey
  • Autor: Alberto Garrido Colmenero (UPM)
  • Autor: J. Calatrava
Research Group, Departaments and Institutes related
  • Creador: Grupo de Investigación: Economía Agraria y Gestión de los Recursos Naturales
  • Centro o Instituto I+D+i: Centro de Estudios e Investigación para la Gestión de Riesgos Agrarios Medioambientales (CEIGRAM). Centro Mixto UPM-AGROMUTUA-ENESA
  • Departamento: Economía Agraria, Estadística y Gestión de Empresas
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