Insurance, credit, and technology adoption: Field experimental evidencefrom Malawi

Giné, Xavier; Yang, Dean

doi:10.1016/j.jdeveco.2008.09.007

Cited by 460 publications

(344 citation statements)

References 21 publications

(23 reference statements)

Supporting

Mentioning

323

Contrasting

Unclassified

Order By: Relevance

“…Recent interest in investing heavily in rural Africa, whether through distributing antimalarial bed nets (23,24), subsidizing fertilizer (25,26), or extending pineapple as an export crop (27), accentuates the importance of understanding the gendered nature of interactions of household members and attributing the gendered character of interaction to preferences, bargaining, or social norms. Future research should not neglect the burgeoning field of behavioral economics, which assesses the likelihood of significant differences across men and women in procrastination and time preference, attitudes to risk and aversion to loss (28), willingness to invest in competitive social situations (29), and preferences to structure social arrangements in ways that are perceived to be fair.…”

Section: Gendered Choice In Householdsmentioning

confidence: 99%

Gendered production and consumption in rural Africa

Kevane

2011

Proc. Natl. Acad. Sci. U.S.A.

View full text Add to dashboard Cite

Recent research underscores the continued importance of gender in rural Africa. Analysis of interactions within households is becoming more sophisticated and continues to reject the unitary model. There is some evidence of discriminatory treatment of girls relative to boys, although the magnitudes of differential investments in health and schooling are not large and choices seem quite responsive to changes in opportunity costs. Social norms proscribing and prescribing male and female economic behavior remain substantial, extending into many domains, especially land tenure. Gender constructions are constantly evolving, although there is little evidence of rapid, transformative change in rural areas.agriculture | development | women T he economic lives of people in many parts of rural Africa are deeply gendered. Farm activities have sex valences. Handling the plow is work for men, and guiding the oxen is work for women; rice is planted by women, and cotton is managed by men. Rural households often invest less in girl children than boy children. Governments assign programs and projects to the different sexes: microfinance for women and pesticides for men. Local judges interpret custom and law as properly gendered. A wife hoping to inherit her husband's land may find herself evicted by his brother. These are illustrative generalizations, of course, and not facts. There is considerable variation across regions and ethnic groups and over time. However, there can be little doubt that gendered structures and choices and ensuing gendered life trajectories are important and complex. This article reviews an expanding literature that examines the mechanisms involved, programs and policies designed around these mechanisms, and effects of public action and large-scale change regarding gendered social structures in rural Africa.Gender is best thought of as a set of shared discursive habits relating to males and females. These habits encompass but are not limited to cognitive characterizations of gendered behaviors, expectations about gendered actions, and gendered decision algorithms. The habits guide people when they think about how other people might react to proposed action. Sometimes, the habits agree with a person's reasoned judgment, and sometimes, they do not, in which case a person might experience mental distress and cognitive dissonance. The actions under consideration range from the ordinary chores of everyday living to the infrequent and worrisome markers of life changes and from the private utterances intended for oneself to formal public pronouncements. These actions by individuals are evaluated by people in a community, and over time in-

show abstract

Section: Gendered Choice In Householdsmentioning

confidence: 99%

Gendered production and consumption in rural Africa

Kevane

2011

Proc. Natl. Acad. Sci. U.S.A.

View full text Add to dashboard Cite

show abstract

“…In some cases, insurance is bundled with credit and savings products to enhance their value and increase demand (Giné and Yang 2009;Stein and Tobacman 2015). Insurance-linked credit shields agricultural loans against weather-related production risks, while insurance-linked savings products are simply insurance contracts with a guaranteed minimum payout.…”

Section: Introductionmentioning

confidence: 99%

Climate change skepticism and index versus standard crop insurance demand in coastal Bangladesh

2017

View full text Add to dashboard Cite

This paper investigates if climate change skepticism, farmers' fatalistic beliefs, and insurance plan design influence interest in crop weather insurance. While studies of the influence of fatalism on disaster preparedness are common, the ways in which fatalism influences climate change skepticism, and in turn affects farmers' interest in crop insurance, have not been previously investigated. An additional objective was to understand farmers' preferences for index versus standard insurance options, the former entailing damage compensation based on post-hazard assessment, the latter tying damage compensation to a set of weather parameter thresholds. A discrete choice experiment was conducted with maize farmers on a climate-risk prone island in coastal Bangladesh. Most farmers were insurance averse. Those who chose insurance were however significantly more likely to select standard as opposed to index-based insurance. Insurance demand was significantly and positively correlated with farmers' concern about the adverse livelihood impacts of climate change. Farmers who exhibited fatalistic views regarding the consequences of climate change were significantly less likely to opt for insurance of either kind. These findings imply that the prospect for farmers' investment in insurance is conditioned by their understanding of climate change risks and the utility of adaptation, in addition to insurance scheme design.

show abstract

“…Indeed, 19 Berhane et al (2013) observe that "nothing sells insurance like insurance pay-outs". This is 20 confirmed by Cole, Stein and Tobacman (2014) who found that both previous pay-outs 21 experienced by oneself and previous pay-outs to village members increase demand.…”

mentioning

confidence: 99%

Adoption and impact of index-insurance and credit for smallholder farmers in developing countries

Marr

Winkel

Asseldonk³

et al. 2016

Agricultural Finance Review

View full text Add to dashboard Cite

Purpose – The purpose of this paper is to review the most recent scientific literature on the determinants explaining the demand for index-insurance, the impact of index-insurance and the existing links between insurance and credit. In this meta-analysis, the authors identify key discoveries on the potential of index-insurance in enhancing credit supply for smallholders and thus farm productivity. Design/methodology/approach – Following a systematic literature search in Scopus and Web of Science, relevant empirical articles were identified by using the following criteria search algorithm: “insurance” and (“weather” or “micro” or “area?based” or “rain*” or “livestock” or “index”), and ((“empiric*” or “experiment” or “trial” or “RCT” or “impact”) or (“credit” or “loan*” or “debt” or “finance”)). The authors identified 1,133 related papers, 110 of which were selected as closely matching the study criteria. After removing duplicates and analysing each document, 45 papers were included in the current analysis. The framework for addressing insurance and credit issues, in the paper, entails three subsequent themes, namely, adoption of insurance, impact of insurance and links between insurance and credit. Findings – It is not confirmed yet that demand for insurance is indeed hump-shaped in risk aversion and the functional form of this relationship should be tested in more detail. This also holds for the magnitude of the effect of trust and education on actual demand. Furthermore, it is unclear to what extent other risk mitigation strategies form complements or substitutes to index-insurance. Lastly, the interaction between basis risk and price is important to the design of index-insurance products. If basis risk and price elasticity are indeed highly correlated, products that diminish basis risk are crucial in increasing demand. On the impact of bundled products, e.g. combination of insurance and credit, limited empirical research has been conducted. For example, it is unknown to what extent credit suppliers would react to the insured status of farmers or what the preferences of farmers are when it comes to a mix of financial products. In addition, several researchers have suggested that microfinance institutions or banks could insure themselves against covariate risk, yet no empirical evidence about this insurance mechanism has been conducted so far. Research limitations/implications – The authors based the research on scientific literature uploaded in Scopus and Web of Science. Other potentially insightful grey literature was not included due to lack of accessibility. Given the research findings, there is plenty of opportunity for further research particularly with regard to the effects of bundled products, e.g. insurance plus credit, on demand for index-insurance, supply of credit, loan conditions and impact on farm productivity and farmers’ well-being. Practical implications – Microfinance institutions, insurance companies, NGOs, research institutions and universities, particularly in developing countries, will be interested to learn about the systematic review of scientific research done in the area of insurance and credit for agriculture and the possibilities for application in their own practice of supplying these financial products. Social implications – A rigorous understanding of the potential of index-insurance and credit is essential for identifying the right mix of financial products that help smallholder farmers to increase farm productivity and their own well-being. Originality/value – The paper is valuable due to its rigorous evaluation of existing theoretical and empirical research around issues explaining the degree of adoption and impact of index-insurance and that of bundled financial products (i.e. index-insurance plus credit). The paper has the potential to become essential reading for academics, practitioners and policy-makers interested in researching and putting in practice the best options leading to greater farm productivity and well-being in developing countries.

show abstract

Insurance, credit, and technology adoption: Field experimental evidencefrom Malawi

Cited by 460 publications

References 21 publications

Gendered production and consumption in rural Africa

Gendered production and consumption in rural Africa

Climate change skepticism and index versus standard crop insurance demand in coastal Bangladesh

Adoption and impact of index-insurance and credit for smallholder farmers in developing countries

Contact Info

Product

Resources

About