Welfare Impacts of Index Insurance in the Presence of a Poverty Trap

Chantarat, Sommarat; Mude, Andrew G.; Barrett, Chris; Turvey, Calum G.

doi:10.1016/j.worlddev.2016.12.044

Cited by 77 publications

(46 citation statements)

References 24 publications

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“…Sources: IBLI: Bageant and Barrett (2017), Chantarat et al (2017), Dror et al (2015), Jensen et al (2015). ACRE: Goslinga (2012), Wills et al (2015), IIF (2017).…”

Section: Representationmentioning

confidence: 99%

“…Less attention has been paid to how farmers' access to index insurance interfaces with inequalities already present in farming populations, or of the differential social impact of index insurance schemes upon an already heterogeneous rural population. Studies exploring socioeconomic and welfare issues include Bageant and Barrett (2017), Chantarat, Mude, Barrett, and Turvey (2017), Janzen and Carter (2013), Jensen, Barrett, and Mude (2015), Jensen, Mude, and Barrett (2018), Jensen and Barrett (2017), Peterson and Osgood (2016) and Taylor (2016). While studies increasingly explore socioeconomic dynamics, including those related to inequality and unequal power relations, debate on index insurance and social equity per se is limited, although research is starting to highlight the need for more attention to be directed towards equity dimensions (Müller, Johnson, & Kreuer, 2017;Reeves, 2017).…”

Section: Introductionmentioning

confidence: 99%

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Index insurance and climate risk management: Addressing social equity

Fisher

Hellin

Greatrex

et al. 2019

Development Policy Review

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MotivationFair distribution of benefits from index insurance matters. Lack of attention to social equity can reinforce inequalities and undermine the potential index insurance holds as a tool for climate risk management that is also pro-poor. PurposeThe aims are to: (i) examine social equity concerns raised by index insurance in the context of climate risk management; (ii) consider how greater attention can be given to social equity in index insurance initiatives; and (iii) reflect on the policy challenges raised by taking social equity into account as a mechanism for climate risk reduction. Approach and methodsThe article draws on learning from the CGIAR's Research Program on Climate Change, Agriculture and Food Security (CCAFS) and presents the cases of the Index Based Livelihoods Insurance (IBLI) andAgriculture and Climate Risk Enterprise Ltd. (ACRE) in East Africa. It proposes a framework for unpacking social equity related to equitable access, procedures, representation and distribution within index insurance schemes. FindingsSystematically addressing social equity raises hard policy choices for index insurance initiatives without straightforward solutions. Attention to how benefits and burdens of index insurance are distributed raises the unpalateable truth for development policy that the poorest members of rural society can be excluded. Nevertheless, a focus on social equity may open up opportunities to ensure index insurance is

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“…Sources: IBLI: Bageant and Barrett (2017), Chantarat et al (2017), Dror et al (2015), Jensen et al (2015). ACRE: Goslinga (2012), Wills et al (2015), IIF (2017).…”

Section: Representationmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Index insurance and climate risk management: Addressing social equity

Fisher

Hellin

Greatrex

et al. 2019

Development Policy Review

View full text Add to dashboard Cite

show abstract

“…A SECTION SECTION 97 21 The ultra-poverty rate is based on a national rural poverty line equivalent to US$0.5/day. 22 These results are parallel to findings in Chantarat et al (2014) and Barrett et al (2012). 23 For further discussion of Kenya's experience with agricultural insurance, see GoK (2014a), which is the source of the information presented in this section.…”

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confidence: 62%

Kenya Toward a National Crop and Livestock Insurance Program

2015

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“…Barrett et al 2007), and some successes reported (e.g. Chantarat et al 2017), the Binswanger-Mkhize critique should not be treated lightly.…”

Section: − = −mentioning

confidence: 98%

Addressing Fractional Dimensionality in the Application of Weather Index Insurance and Climate Risk Financing in Agricultural Development: A Dynamic Triggering Approach

Turvey

Shee

Marr

2019

Weather, Climate, and Society

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Climate risk financing programs in agriculture have caught the attention of researchers and policy makers over the last decade. Weather index insurance has emerged as a promising market-based risk financing mechanism. However, to develop a suitable weather index insurance mechanism it is essential to incorporate the distribution of underlying weather and climate risks to a specific event model that can minimize intraseasonal basis risk. In this paper we investigate the erratic nature of rainfall patterns in Kenya using Climate Hazards Group Infrared Precipitation with Station Data (CHIRPS) rainfall data from 1983 to 2017. We find that the patterns of rainfall are fractional, both erratic and persistent, which is consistent with the Noah and Joseph effects that are well known in mathematics. The erratic nature of rainfall emerges from the breakdown of the convergence to a normal distribution. Instead we find that the distribution about the average is approximately lognormal, with an almost 50% higher chance of deficit rainfall below the mean than adequate rainfall above the mean. We find that the rainfall patterns obey the Hurst law and that the measured Hurst coefficients for seasonal rainfall pattern across all years range from a low of 0.137 to a high above 0.685. To incorporate the erratic and persistent nature of seasonal rainfall, we develop a new approach to weather index insurance based upon the accumulated rainfall in any 21-day period falling below 60% of the long-term average for that same 21-day period. We argue that this approach is more satisfactory to matching drought conditions within and between various phenological stages of growth.

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Welfare Impacts of Index Insurance in the Presence of a Poverty Trap

Cited by 77 publications

References 24 publications

Index insurance and climate risk management: Addressing social equity

Index insurance and climate risk management: Addressing social equity

Kenya Toward a National Crop and Livestock Insurance Program

Addressing Fractional Dimensionality in the Application of Weather Index Insurance and Climate Risk Financing in Agricultural Development: A Dynamic Triggering Approach

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