Staff Publications

Staff Publications

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    'Staff publications' is the digital repository of Wageningen University & Research

    'Staff publications' contains references to publications authored by Wageningen University staff from 1976 onward.

    Publications authored by the staff of the Research Institutes are available from 1995 onwards.

    Full text documents are added when available. The database is updated daily and currently holds about 240,000 items, of which 72,000 in open access.

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Record number 504285
Title Applying weather index insurance to agricultural pest and disease risks
Author(s) Norton, Michael; Sprundel, Gert Jan van; Turvey, Calum G.; Meuwissen, Miranda P.M.
Source International Journal of Pest Management 62 (2016)3. - ISSN 0967-0874 - p. 195 - 204.
DOI http://dx.doi.org/10.1080/09670874.2016.1184773
Department(s) Business Economics
WASS
Publication type Refereed Article in a scientific journal
Publication year 2016
Keyword(s) Insurance - Karnal bunt - market-based - pesticide use efficiency - risk - Stewart's disease - weather
Abstract

In this paper, we explore the application of weather index insurance to plant pest and disease management strategies using two distinct models: (1) insuring crop loss due to disease incidence (“Crop Insurance”) and (2) insuring the use of pesticides (“Pesticide Insurance”). We find that despite the seeming ease of applying weather-based pest incidence models to an insurance product, insuring plant disease incidence models is presently unsuitable for the insurance market for both scientific and behavioral reasons. However, derivative-like applications of weather index insurance to insure pesticide use offer a means to introduce financial leverage into pesticide usage decisions. Risk management with weather index insurance would thus function as a complement to existing risk management strategies using pesticides, and offer a market-based mechanism for pesticide abatement. We conclude that more interdisciplinary collaboration is needed to develop weather index insurance for remuneration of losses due to plant pests and diseases, but weather index insurance offers a potential mechanism to reduce inefficiencies and negative externalities in agricultural markets if pesticide expenditures are insured instead of crop losses.

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