Implications and evaluation of crop insurance choices for cotton farmers under the 2014 farm bill

Kishor P. Luitel, Darren Hudson, Thomas Knight

Research output: Contribution to journalArticlepeer-review

Abstract

The Agricultural Act of 2014 introduced new crop insurance policies to manage agricultural risk, especially to cotton farmers. A representative farm panel was used to elicit the yield distribution of the farm, county, and correlation. Results suggest that the optimal underlying insurance policy is Revenue Protection at a 75% coverage level for both high- and low-productivity farms even with a Yield Exclusion provision. The Stacked Income Protection Plan benefit is mostly attributable to a higher insurance premium subsidy. For any crop, efficient agricultural risk management can be achieved through understanding the guaranteed yield and its relation to the farm and county yield.

Original languageEnglish
Pages (from-to)526-543
Number of pages18
JournalJournal of Agricultural and Applied Economics
Volume50
Issue number4
DOIs
StatePublished - Nov 1 2018

Keywords

  • 2014 Farm Bill
  • Correlation
  • SCO endorsement
  • STAX
  • Yield Exclusion
  • cotton representative farm simulation
  • crop insurance
  • elicitation

Fingerprint Dive into the research topics of 'Implications and evaluation of crop insurance choices for cotton farmers under the 2014 farm bill'. Together they form a unique fingerprint.

Cite this