scholarly journals Impact of Formal Climate Risk Transfer Mechanisms on Risk-Aversion: Empirical Evidence from Rural Ethiopia

2019 ◽  
Author(s):  
Kaleab K. Haile ◽  
Eleonora E. Nillesen ◽  
Nyasha Tirivayi
Keyword(s):  
Risk Aversion ◽  
Empirical Evidence ◽  
Climate Risk ◽  
Risk Transfer ◽  
Rural Ethiopia ◽  
Transfer Mechanisms

Developing resilience to hydrologic extremes in irrigated agriculture through risk transfer mechanisms in the context of southeastern Brazil

2021 ◽  
Author(s):  
Marcos Roberto Benso ◽  
Gabriela Chiquito Gesualdo ◽  
Eduardo Mario Mendiondo ◽  
Lars Ribbe ◽  
Alexandra Nauditt
Keyword(s):  
Climate Change ◽  
Land Use ◽  
Crop Yield ◽  
Cash Flow ◽  
Synthetic Data ◽  
Southeastern Brazil ◽  
Irrigated Agriculture ◽  
Risk Transfer ◽  
Hydrologic Extremes ◽  
Transfer Mechanisms

<p>In the last decades, we have witnessed increasing losses on crop yield due to an increase in magnitude and frequency of hydrological extremes such as droughts and floods. These hazards promote systematic and regressive impacts on the economy and human behavior. Risk transfer mechanisms are key to cope with the economic impacts of these events, therefore safeguarding income to farmers and building resilience to the overall sector. The index-based insurance establishes an index that can be monitored in real or near-real-time, which is associated with losses to a specific agent. While the manifestation of the causality hazard to exposure and exposure to damage and its mathematical representation in cash flow equations is a hard task, incorporating an objective and transparent index adds up a new challenge to this modeling framework. Moreover, past events that have been used as the main guide to evaluating expected losses given risk can no longer offer an accurate risk estimation due to environmental changes. This work aims to tackle the hydrologic extremes risk transfer modeling in irrigated agriculture to obtain optimized premium values and parameters of an insurance fund for irrigated agriculture in Southeastern Brazil. This study will be developed in the Piracicaba, Jundiaí, and Capivari river basin, also known as PCJ catchment in the states of São Paulo and Minas Gerais, Brazil. The region, with approximately 5 million inhabitants, is considered one of the most important in Brazil due to its economic development, which represents about 7% of the National Gross Domestic Product (GDP). The Hydrologic Risk Transfer Model of the Hydraulic and Sanitation department of the University of São Paulo (MTRH-SHS) will be used to obtain optimized premium values. The main index variable is streamflow fitted to extreme value theory distribution for low and high flows. To evaluate climate change and land-use change scenarios, Regional Climate Models (RCMs) and land use projections will be related to streamflow in a hierarchical Bayesian framework. Synthetic data will be then simulated according to scenarios previously defined in a Monte Carlo approach. The hazard-damage function will be obtained by total crop yield and revenue per municipality, then the relationship between the index and expected losses is determined in an empirical equation. Finally, a cash flow computation is run with synthetic data obtaining optimized premiums in a way to minimize fund storage values. We expect to provide further evidence of the feasibility of actuarially fair premium values for the agents in the sector considering global phenomena of climate change and land-use change. Results will support climate change adaptation plans and policy as well as contribute to methods for estimating risk in a changing environment.</p>

Conclusion, 11 Concluding Remarks on the Theoretical, Legal, and Practical Challenges of European Antitrust Criminalization

2014 ◽  
Author(s):  
Whelan Peter
Keyword(s):  
Risk Aversion ◽  
Empirical Evidence ◽  
Cultural Sensitivity ◽  
Information Exchange ◽  
Quantitative Research ◽  
Empirical Studies ◽  
Deterrence Theory ◽  
Eu Member States ◽  
Research Questions ◽  
Rationality Assumption

This concluding chapter provides final remarks on the theoretical, legal, and practical challenges of European antitrust criminalization. It also determines five different research questions that should be addressed by future researchers. First, more detailed, reliable empirical evidence on the motivations of cartelists and whether or not they act in accordance with the rationality assumption of deterrence theory is required. Second, detailed qualitative and quantitative research concerning the usefulness of information exchange within the European Competition Network (ECN) would also be useful. Third, empirical evidence should be generated concerning whether consumers actually assume that their suppliers are not engaged in cartel activity with their competitors. Fourth, empirical studies on the extent to which risk aversion is a characteristic of corporate entities need to be pursued. Finally, empirical evidence on the cultural sensitivity of perceptions of cartel activity among the citizens of the different EU Member States would be welcome.

Why Do Demand Curves for Stocks Slope Down?

2009 ◽  
Vol 44 (5) ◽  
pp. 1013-1044 ◽  
Author(s):  
Antti Petajisto
Keyword(s):  
Risk Aversion ◽  
Empirical Evidence ◽  
Cross Section ◽  
Stock Prices ◽  
Individual Investors ◽  
Market Portfolio ◽  
Collective Risk ◽  
Demand Curves ◽  
Price Effects ◽  
Money Managers

AbstractRepresentative agent models are inconsistent with existing empirical evidence for steep demand curves for individual stocks. This paper resolves the puzzle by proposing that stock prices are instead set by two separate classes of investors. While the market portfolio is still priced by individual investors based on their collective risk aversion, those individual investors also delegate part of their wealth to active money managers, who use that capital to price stocks in the cross section. In equilibrium, the fee charged by active managers has to equal the before-fee alpha they earn. This endogenously determines the amount of active capital and the slopes of demand curves. A calibration of the model reveals that demand curves can be steep enough to match the magnitude of many empirical findings, including the price effects for stocks entering or leaving the S&P 500 index.

scholarly journals Can Risk-aversion Towards Fertilizer Explain Part of the Non-adoption Puzzle for Hybrid Maize? Empirical Evidence from Malawi

2006 ◽  
Vol 6 (7) ◽  
pp. 1490-1498 ◽  
Author(s):  
Franklin Simtowe ◽  
John Mduma . ◽  
Alexander Phiri . ◽  
Alban Thomas . ◽  
Manfred Zeller .
Keyword(s):  
Risk Aversion ◽  
Empirical Evidence ◽  
Hybrid Maize

Natural Disaster Risk Financing and Transfer in ASEAN Countries

2020 ◽  
Author(s):  
Paul Raschky ◽  
Sommarat Chantarat
Keyword(s):  
Financial Risk ◽  
Ad Hoc ◽  
Large Fraction ◽  
Risk Modeling ◽  
Risk Transfer ◽  
Multilateral Cooperation ◽  
Asean Countries ◽  
Transfer Mechanisms ◽  
Financial Losses ◽  
Disaster Risk Financing

ASEAN countries are frequently hit by a variety of natural disasters, and a large fraction of economic activity in ASEAN countries is located in areas exposed to these natural perils. Increasing disaster damages require ASEA countries to manage the financial losses in a more efficient and proactive manner. Currently, most risk-transfer mechanisms in this region rely on ad-hoc government relief, which is not sustainable. Multilateral cooperation in the areas of risk-modeling and mapping as well as joint efforts to establish financial risk-transfer solutions could help to overcome existing challenges in this area.

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