Theses and Dissertations
Issuing Body
Mississippi State University
Advisor
Coble, Keith H.
Committee Member
Harri, Ardian
Committee Member
Barnett, Barry J.
Committee Member
Riley, John Michael
Date of Degree
8-17-2013
Document Type
Graduate Thesis - Open Access
Major
Agricultural Economics
Degree Name
Master of Science
College
College of Agriculture and Life Sciences
Department
Department of Agricultural Economics
Abstract
Revenue insurance with shallow loss protection for farmers has been introduced recently. A common attribute of most shallow loss proposals is that they would be arearevenue triggered. The impact on optimal hedge ratios of combining these shallow loss insurance proposals with deep loss farm-level insurance is examined. Since crop insurance, commodity programs and forward pricing are commonly used concurrently to manage crop revenue risk, the optimal combinations of these tools are explored. Numerical analysis in the presence of yield, basis and futures price variability is used to find the futures hedge ratio which maximizes the certainty equivalent of a risk averse producer. The results generally reveal a lower optimal hedge ratio with area-insurance than with individual insurance and show that shallow loss revenue insurance tends to slightly increase optimal hedge ratios.
URI
https://hdl.handle.net/11668/19851
Recommended Citation
Tran, Trang Thu, "Proposed Farm Bill Impact on Optimal Hedge Ratios for Crops" (2013). Theses and Dissertations. 3663.
https://scholarsjunction.msstate.edu/td/3663
Comments
area crop insurance||simulation||optimal hedge ratio