Research ON RaTe Making Of PeAnUt INcOMe INsURaNcE BASed ON Copula

Agricultural income insurance,represents a general direction of agricultural insurance development,can effectively prevent the double risk of per unit yield and price,which is more complied with the requirements of WTO "green box policy".However,China's agricultural insurance is still dominated by output insurance and cost insurance currently,and income insurance is still in the pilot exploration stage.There are two main reasons that result in the unsuccessful proceed of China's agricultural income insurance.Firstly,the study on China's agricultural income insurance has been implemented later and all research and pilot work has been commonly carried out around main grain crops such as corn,as well as soybeans,cotton and other varieties.But these crops lacked market-driven historical price data owing to long-term implementation of purchase price policy before,which caused a difficult position in setting income insurance rate.Secondly,income insurance also has encountered the problems of high moral hazard and high supervised cost.To this end,it will make a great difference for solving such a problem to conduct a income insurance research on crops with an earlier marketization of price formation mechanism,especially the cash crops with high price fluctuation,and try to link the weather index with income insurance.Therefore,taking peanuts in Henan Province as an example,this essay uses Copula function to study the rate determination of the traditional income insurance for cash crops and design a weather index peanut income insurance with its rate determined on the basis of demonstrating the necessity of implementing income insurance.The significance of this essay lies in that,on the one hand,it makes up the shortcomings of domestic research on the use of Copula function to determine income insurance of crops.It not only chooses the cash crops with earlier price marketization,the peanut as the research object,but also takes regional differences of income insurance into full consideration,providing decision-making basis and rate reference for the implement of the income insurance of cash crops,especially peanut.On the other hand,innovatively combining weather index insurance with crop income insurance provides a feasible thread for solving the problem of high supervision cost and high moral hazard in the practice of income insurance.In this essay,firstly,HP Filter is adopted to analyze the fluctuation of peanut per unit yield and price in Henan province,so as to conduct the research on the necessity of peanut income insurance.Secondly,Copula function and Monte Carlo sampling are adopted to determined the rate of traditional income insurance in the three major production city of Henan Province and calculate the premium price,and compare with current peanut cost insurance in Henan;Lastly,taking Xiangfu District of Henan province as an example,the contract of weather index peanut income insurance was made,the relationship between weather factors and unit peanut yield was established by multivariate spline regression,the rate of weather index peanut income insurance was determined by drawing the lessons from the thinking of weather index insurance and traditional income insurance with comparing the local traditional income insurance and weather index insurance.The research results show that:(1)Peanut farmers face great risks of unit yield and price risk and the price risk has a expansive tendency.It indicates that peanut farmers in Henan has a great potential need for peanut income insurance.(2)Traditional peanut income insurance differs from region to region.The rates of peanut income insurance in Nanyang City,Kaifeng City and Zhumadian City are2.1%-17.8%,1.6%-12.5% and 3.8%-16.9% respectively under the guarantee level of 40%~100%.The rate in each city drops sharply as the guarantee level declined.In the same guarantee level,the rates of peanut income insurance are lower than cost insurance and it can provide farmer with higher risk guarantee level.(3)The assumption of indexing crop income insurance to lower transaction costs and moral hazard is available.The rate of weather index income insurance in Xiangfu District is lower than current cost insurance in Henan Province,the rate is The rate is between 1.3%-12.7% under the guarantee level of 40%-100%.According to the study on the determination of peanut income insurance rate,this essay proposes that China should up the implementation of cash crops income insurance,such as peanuts and build a regional agricultural income insurance system.In the specific process of implementing income insurance,we should set a differentiation reasonable risk guarantee level and establish an authoritative peanut price forecasting mechanism.Last,as weather index income insurance is of certain feasibility,some researches and pilots could be explored.