engleski

Effectiveness of weather derivatives as a hedge against the weather risk in agriculture

Weather aff ects the economies worldwide and all economic sectors are to some extent weather sensitive. Agriculture is traditionally highly weather sensitive. While the catastrophic impact of weather has been long recognized, studied and managed the non-catastrophic weather risk gains in importance as the climate change becomes more pronounced. Weather derivatives provide a fl exible management solution for the non-catastrophic weather risk. Th e paper presents weather derivatives as a new weather risk management tool and reviews and discusses the eff ectiveness of their application in agriculture.

agriculture ; hedging eff ectiveness ; non-catastrophic weather risk ; weather derivatives

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