Abstract: Both crop insurance and stress tolerant seeds have the potential to increase the resilience of smallholder farmers in the face of weather shocks. At the same time uptake remains a challenge. We present the results of two projects that bundle insurance and seeds, either conditionally (free insurance under condition of buying seeds) or unconditionally (seeds are not a prerequisite for insurance). We also vary the types of insurance offered, introducing a product designed to reduce basis risk compared to standard weather indexes (i.e., picture-based insurance). We find that conditioning insurance on seeds has much greater effects on uptake and investments, and that innovations geared at reducing basis risk improve willingness to pay significantly without evident consequences adverse selection and moral hazard.
Presenter:
- Francesco Cecchi, Assistant Professor, Development Economics Group, Wageningen University
Moderator:
- Joachim De Weerdt, Country Program Leader, IFPRI-Malawi
Date:
- 23 November 2022
