Felice Adinolfi

Farmer Participation, Entry and Exit Decisions in the Italian Crop Insurance Programme

The factors affecting the demand for agricultural insurance in the USA have been extensively studied over the last two decades. However, the determinants of a farms entry and exit decisions in the insurance market have received relatively little attention. Turnover in the insurance book of business is an important issue in most private and public crop insurance plans. Moreover, insurance markets in the EU are still largely under-investigated. We investigate empirically the determinants of crop insurance participation in Italy. We show that the participation rate is high for large firms and that it is negatively correlated with crop diversification, which is itself a form of insurance. High premiums tend to inhibit both entry and exit from the insurance market. Larger and wealthier farms are more likely to adopt insurance and renew coverage over time. We discuss implications of our results for public intervention and the private industry. In particular, we demonstrate that the decision to drop coverage by an insured grower may differ significantly from the corresponding decision to enroll in an insurance programme by an uninsured farmer. To the extent that policymakers want to encourage participation in subsidized crop insurance programmes, education and outreach efforts toward uninsured farmers may differ substantially from those directed toward keeping insured farmers enrolled in the programme. We investigate these differences.

Does market competitiveness significantly affect public intervention in agricultural insurance: the case in Italy

Analyses of agricultural insurance failures often assume the existence of competitive supply, tracing the reasons for high insurance cost and limited farmer participation to informational problems, and suggesting the need for premium subsidization in order to increase participation. However, in countries such as Spain and Italy, where agricultural insurance is most highly subsidized, it could be that supply is not fully competitive. In this article, we explore the incidence of public subsidies to agricultural insurance premia when supply is noncompetitive. Through the use of a simple empirical model of an insurance market, it is shown that, while in the case of a competitive supply, subsidies to insurance would benefit farmers, a monopolistic supply would capture most of the subsidy, thus eliminating the potential incentive towards wider participation by farmers. The model is applied to a panel of Italian farms for different levels of risk aversion to demonstrate the limited effect that a subsidy to a hypothetical all risk yield insurance would have on farmer participation in the case of monopolistic supply.

What Foods are Identified as Animal Friendly by Italian Consumers

In the Italian market, voluntary certifications implying higher levels of animal welfare generally fall into wider production schemes. Despite of the results of EU surveys indicating that about 50% of Italian consumers can easily identify and find animal-friendly products, they still are distributed scarcely or discontinuously in the main retail chains. To assess the apparent contradiction between the intricate information consumers receive from labels and their declared awareness about animal welfare, a survey was conducted in Emilia Romagna region on 355 Italian consumers (face-to-face interviews based on a structured, semi-close-ended questionnaire). Overall, consumers showed a low degree of knowledge about animal welfare attributes, animal farming conditions and animal protection policies (about 30% of correct answers), and a low level of awareness of the effects of their purchasing choices on the welfare of farmed animals (22%). The respondents also showed difficulties in identifying animal-friendly products and often confused them with other certified foods, having sometimes a weak connection (or none at all) to animal welfare (e.g., Protected Designation of Origin products). However, most consumers declared to be ready to pay a premium price in name of animal welfare. In conclusion, a labelling system for the welfare content of animal-derived foods is confirmed to be an effective strategy to compensate the efforts of farmers in improving animal welfare, provided that the information given is clear and able to fill the substantial lack of consumer knowledge.

Integrating Agricultural Risks Management Strategies in Selected EU Partner Countries: Syria, Tunisia, Turkey

Dynamics and transitions in the agricultural sector of emerging countries are not well understood yet. A decade of major political and economic changes is challenging the Mediterranean Economies, affecting the primary sectors of transition economies which are largely influenced by recent trends. The resulting exposure of agriculture to risks has called great attention on risk management strategies and public intervention. We explore their role in three different economies with a view to a unified policy framework. The analysis is conducted through a field activity in Syria, Tunisia and Turkey that has allowed to understand the key issues. The experts’ opinions draw a clear picture of retrospect and prospects and stimulate a comparative analysis that widens the current knowledge of risk management in the EU Partner Countries.

Crop Insurance Subsidies and Environmental Externalities: Evidence from Southern Italy

Rapid environmental changes can affect agriculture by introducing additional sources of uncertainty. Conversely, policy interventions to help farmers cope with risks can induce strong impacts on the environment. In this paper, the authors evaluate the effects of public risk management programmes, particularly subsidies on crop insurance, on fertilizer use and land allocation. They implement a mathematical programming model based on data collected from 1,092 farms in the Puglia region of southern Italy. The results show that, under the current crop insurance programmes, input use is expected to increase, while the effect on production is likely to be crop-specific. The policy and environmental implications of subsidies on crop insurance are discussed.

Economic issues on food safety

A globalised food trade, with a huge increase of the exchanged volume, extensive production and complex supply chains are contributing towards an increased number of microbiological food safety outbreaks. All of these factors are putting pressure on the stakeholders, either public or private, in terms of rule and control. In fact, this scenario could force manufacturers to be lenient towards food safety control intentionally, or unintentionally, and result in a major foodborne outbreak that causes health problems and economic loss. As a response to emerging calls for the adoption of a systemic approach to food safety, we try to identify and discuss the several related economics issue in this field. Based on an extensive analysis of academic and policy literatures on the economic effects of global environmental change at different stages of the food system, we highlight the main issues involving economists in the field of food safety. In the first part, we assessed the several approaches and problems related to the evaluation of food safety improvements, followed by an overview of drivers of food safety demand in the second part. The third section is devoted to discussing changes occurred at the institutional level in building and managing food safety policies. The last section summarises the main considerations aroused from the work.

A case-study on profiling Italian consumers of animal-friendly foods

Abstract Our research is based on 335 consumer interviews, conducted near and within supermarkets and hypermarkets in Bologna (North-Italy) and in its province. A multiple correspondence analysis followed by a cluster analysis were carried out in order to profile consumers based on their knowledge of farming conditions, their knowledge of “animal friendly” products and their willingness to pay for them. The analysis identified four groups of consumers (clusters). Groups were called: (1) “sensible and aware consumers” (36%); (2) “unconcerned consumers” (33%); (3) “the insiders” (6%) and (4) “uninvolved consumers” (25%). The first group represents an important market segment for “animal friendly” products. However, a diffused lack of knowledge was observed towards the issues of animal welfare and animal protection. These results urge a reflection on the needs and the risks that may underlie the creation of a shared European label for animal-friendly foods in order to minimize the risk of a failure of the certification scheme.

Composizione dell’impresa agricola familiare e accesso alle politiche di sviluppo rurale

The aim of the paper is the analysis of the ‘consumption’ of rural development policies (Rdp) as the result of entrepreneurial behaviours adopted by family run farms. The underlying hypothesis is that family run farm’s characteristics influence the consumption of rural development policies. By suggesting a family run farm perspective, we support the idea that any boundary between productive and reproductive work in the farm household is artificial thus conditioning farm strategy and aptitude to invest. Therefore, a relevant aspect to be examined concerns family size, localization in life cycle, and the presence of assistants within the family run farms.The results of our analysis permit to emphasize the importance of family context in the access to Rdp and the relevance of the family assistants on farm’s propensity to get funded.

“Terra dei Fuochi” and agrifood economy in Campania: the credibility of the Institutions for their citizens

The agriculture and agri-food of Campania in recent times is facing a major obstacle, not tied to the ordinary economic dynamics of the market, but connected to a widespread use of models of media which are demolishing an area identified throughout the region, as well any more tolerable truth. “Terra dei Fuochi” is the slogan that stands in the debates at all levels, and that, outside the control of operators in the agricultural sector, is inexorably undermining the credibility of the brand and the farmers. A sector which in recent years had appropriated space and importance, creating new jobs for young people. In this paper, we introduce the possibility of a problem of credibility of the institutions at every level where, with “measurable and certified data” at the public level, it would not be a slogan to generate economic and social repercussions so serious only based on “opinions”.

Risk management tools and public policy: what is the real farmers demand? Weakness of the current system of public support for risk management in agriculture

Storicamente, le assicurazioni agricole non hanno mai visto un mercato su larga scala senza l’intervento pubblico. Sulle cause del fallimento del mercato privato sono stati spesso citati fenomeni legati all’offerta e alla domanda. Per l’offerta, i fenomeni di asimmetria e incompletezza informativa, con i conseguenti problemi di selezione avversa e azzardo morale, e quello della sistemicita dei rischi; per la domanda, invece, lo scarso uso dell’assicurazione e giustificato con la presunta incapacita da parte degli agricoltori di comprendere appieno i benefici derivanti dall’uso di tale strumento. Piu in generale, quello che manca oggi in Italia (e in Europa) e una chiara identificazione della domanda degli agricoltori per gli strumenti di gestione del rischio. Quali sono le difficolta pratiche, e teoriche, per identificare la domanda di strumenti di gestione del rischio? Quali sono i limiti e le approssimazioni necessarie nella stima della domanda? Mettendo in evidenza i limiti degli approcci teorici frequentemente utilizzati in letteratura, questo lavoro mette in evidenza la necessita di continuare ad individuare modelli teorici piu appro- priati e, soprattutto, a puntare maggiormente sulla disponibilita di dati attendibili e capillari, per poter rispondere alle esigenze sempre piu pressanti di costruire strumenti “veramente utili” all’attivita agricola, oltre che di costruire nuove tipologie di intervento pubblico nella gestione del rischio in agricoltura.