Carlo Cafiero, Monica Palladino, Claudio Marcianò and Giuseppa Romeo
This paper aims to provide evidence on the extent to which traditional agri-food products (TFPs) constitute a leverage to promote tourism in the province of Reggio Calabria…
Abstract
Purpose
This paper aims to provide evidence on the extent to which traditional agri-food products (TFPs) constitute a leverage to promote tourism in the province of Reggio Calabria, Italy, and discuss ways in which community-led local development governance institutions might enhance it.
Design/methodology/approach
The study is based on a review of existing information on Calabrian TFPs to classify them by area of production and identify those that are specific or relatively small areas, in addition to a qualitative analysis of the content of the texts of a sample of websites promoting tourism in the region.
Findings
Though food is one of the leverages used to promote tourism in Calabria, TFPs are not yet sufficiently exploited to attract tourists to the province of Reggio Calabria, in spite of their potential as a vital expression of local culture and traditions.
Research limitations/implications
The selection of the websites used in the study may not be exhaustive of the full spectrum of Web-based promotion of tourism in Calabria.
Practical implications
The results provide useful insights to public and private institutions responsible for rural development and tourism promotion in Calabria. The database on the TFPs of the province of Reggio Calabria permits an easy reading of the geographical distribution of the different categories of products, useful as a resource for further studies and as a local development policy support tool.
Social implications
Promoting a form of culturally sensitive, food-based tourism in the interior areas of Calabria may constitute an important factor to revert the trend towards impoverishment, migration of young people and depopulation of the interior areas of Calabria. This is a particularly sensitive issue in Italy today, in view of the difficulties that other strategies pursued in the area are facing.
Originality/value
Existing literature on typical food products in Italy focuses on those labelled by denomination of origin and geographic protection. This is one of the first papers focusing on TFPs labelled as Prodotti agroalimentari tradizionali in the Italian legislation. By exploring the role of local food and traditions in promoting tourism, this paper expands the scope of existing studies of rural tourism and on rural development in Calabria, and beyond.
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Focussing on the links among people, places and traditions, this study aims to present the reflections derived from five in-depth personal interviews on traditions regarding wine…
Abstract
Purpose
Focussing on the links among people, places and traditions, this study aims to present the reflections derived from five in-depth personal interviews on traditions regarding wine, fish, cheese making and rural hospitality, collected in a journey across the province of Reggio Calabria in southern Italy. It provides an original view of the “stories” behind the places and the products, useful to inform local development strategies centred on traditional food products.
Design/methodology/approach
The article presents a novel approach in conducting research that involves collecting information via empathetic interviews and presenting the findings in a reflexive, narrative storytelling style.
Findings
Empathetic personal interviewing is key to elicit information useful to frame the links among people, places and traditions. The economic motivation is not the main one for people to remain engaged in the production of traditional food products in the province of Reggio Calabria. Pride in linking their activities and the products they make to the territory, its traditions and the culture embedded therein, clearly contribute to define a sense of place that might be further drawn upon in participatory, rural development initiatives.
Research limitations/implications
Due to the way in which the interviewees have been selected, not all findings can be generalized as applicable to the entire Province or beyond.
Practical implications
Recognizing the people and the stories behind a product may offer insights on how to design effective, socially sustainable policies that would preserve important traditions. Personal food narratives might contribute, in a unique way, to an effective branding of the products and the territory.
Social implications
Doing more empathetically participatory research, rather than taking a “neutral” stance in data collection and data crunching, which has traditionally characterized the work of agricultural economists, may help in making the institutions being perceived as less distant by the ultimate beneficiary of development policies and make participatory planning much more effective.
Originality/value
The article contributes to an emerging area of research at the intersection between agricultural economics and rural development policy. How to highlight and protect the people and their stories as fundamental aspects of the “places”, “products” and “traditions”, remains an area of research that has not yet been fully explored, at least in the rhetoric and discourse on integrated rural development in Italy.
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The purpose of this paper is to introduce a continuous time version of the speculative storage model of Deaton and Laroque (1992) and to use for pricing derivatives, in particular…
Abstract
Purpose
The purpose of this paper is to introduce a continuous time version of the speculative storage model of Deaton and Laroque (1992) and to use for pricing derivatives, in particular insurances on agricultural prices.
Design/methodology/approach
The methodology of financial engineering is used in order to find the partial differential equations that the dynamics of derivative prices have to satisfy. Furthermore, by using the Monte-Carlo method (and Feynman-Kac theorem) the insurance prices is computed.
Findings
Results of this paper show that insurance prices (and derivative prices in general) are heavily influenced by market structure, in particular, the demand function specifications. Furthermore, through an empirical analysis, the performance of the continuous time speculative storage model is compared with the geometric Brownian motion model. It is shown that the speculative storage model outperforms the actual data.
Practical implications
Since the agricultural insurances in many countries are subsidised by government, the results of this paper can be used by policy makers to measure changes in agricultural insurance premiums in scenarios that market experiences changes in demand. In the same manner, insurance companies and investors can use the results of this paper to better price agricultural derivatives.
Originality/value
The issue of agricultural insurance pricing (in general derivative pricing) is of great concern to policy makers, investors and insurance companies. To the author’s knowledge, an approach which uses the methodology of financial engineering to compute the insurance prices (in general derivatives) is new within the literature.
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Manuela Ender and Ruyuan Zhang
The purpose of this paper is to analyze the efficiency of temperature-based weather derivatives (WD) in reducing risk exposure for Chinese agriculture industry. Therefore, a put…
Abstract
Purpose
The purpose of this paper is to analyze the efficiency of temperature-based weather derivatives (WD) in reducing risk exposure for Chinese agriculture industry. Therefore, a put option with cumulated growing degree days as its underlying index is assumed to be bought by farmers as a risk management instrument to prevent income fluctuations from adverse temperature conditions.
Design/methodology/approach
The objective of this paper is to analyze the efficiency of temperature-based WD in reducing risk exposure for Chinese agriculture industry. Therefore, a put option with cumulated growing degree days as its underlying index is assumed to be bought by farmers as a risk management instrument to prevent income fluctuations from adverse temperature conditions.
Findings
The results of the efficiency tests show that temperature-based put options are efficient in offsetting yield shortfalls for rice and wheat in China. The weather-yield models have a high prediction power in explaining yield variation by temperature.
Research limitations/implications
The de-trending procedure for the weather-yield model should be improved to distinguish better between technology progress, human activities and influence of weather. Further, more advanced models could be used for the pricing.
Practical implications
The findings of the paper support the launch of WD as an efficient risk management tool for agriculture in China. Compared with traditional damage-based insurance, WD are more flexible, have lower transactions costs and avoid moral hazard or adverse selection.
Originality/value
The efficiency problem of WD has not been analyzed sufficiently worldwide and especially not for developing countries like China where a large proportion of the population works as farmers. This paper supports to fill this gap.
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Kazi Abrar Hossain, Syed Abul Basher and A.K. Enamul Haque
The purpose of this study is to quantify the impact of Ramadan on both the level and the growth of global raw sugar price.
Abstract
Purpose
The purpose of this study is to quantify the impact of Ramadan on both the level and the growth of global raw sugar price.
Design/methodology/approach
The study uses a dummy and a fractional variable to capture Ramadan to overcome the asynchronicity of time between Ramadan fasting (which is based on the Islamic lunar calendar) and the movement in prices (which follows the Gregorian solar calendar). To capture the seasonality of sugar production, the data on sugar price span 34 years so that the Islamic calendar makes a complete cycle of the Gregorian calendar. The empirical model is estimated using both autoregressive integrated moving average model and unobserved components model.
Findings
The results show that monthly raw sugar prices in the global market increases by roughly 6.06 per cent (or $17.78 per metric ton) every year ahead of Ramadan.
Practical implications
The study illustrates the implications of the results for the consumption of imported sugar in Bangladesh.
Originality/value
The study uses a broader set of Ramadan indicators in its empirical models and checks the robustness of its baseline model using the unobserved components model. It also performs seasonal unit root tests on the global raw sugar prices.
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Pier Paolo Miglietta, Donatella Porrini, Giulio Fusco and Fabian Capitanio
The term “charity hazard” refers to the issue of the crowding out of insurance by co-existing relief programs in the context of different institutional governmental disaster…
Abstract
Purpose
The term “charity hazard” refers to the issue of the crowding out of insurance by co-existing relief programs in the context of different institutional governmental disaster schemes. In this context, the aim of this paper is to verify if the charity hazard phenomenon exists in the Italian agricultural insurance scheme.
Design/methodology/approach
Annual data regarding crop insurance, subsidies and farm structure were extracted from ISMEA, ISTAT and FADN databases. A SYS-GMM dynamic panel model was estimated, considering the 2010–2017 time period and the Italian Regions as units of the analysis.
Findings
The empirical results highlight a negative relation between crop subsidies and the farmers' policies and total premium paid. The disincentive and crowd-out effects of public aid and subsidies on the choice of whether or not to take out an agricultural insurance policy ends up being one of the key factors for the low level of penetration of the agricultural insurance in Italy.
Practical implications
Since the diffusion of agricultural insurance can contribute to the general objective of sustainability and resilience, the implementation of alternative solutions to subsidies could be needed (e.g. the introduction of mandatory insurance against adversities or financial support for a geographically specific insurance tool).
Originality/value
Investigating empirically the determinants of the agricultural insurance policy diffusion among the Italian Regions, this study ensures an original contribution to the scientific progress in the field, demonstrating the existence of charity hazard caused by the public subsidies provision.
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The design and pricing of weather‐based insurance instruments is strongly based on an implicit assumption that the dependence structure between crop yields and weather variables…
Abstract
Purpose
The design and pricing of weather‐based insurance instruments is strongly based on an implicit assumption that the dependence structure between crop yields and weather variables remains unchanged over time. The purpose of this paper is to verify this critical assumption by employing historical time series of weather and farm yields from a semi‐arid region.
Design/methodology/approach
The analysis employs two different approaches to measure dependence in multivariate distributions – the regression analysis and copula approach. The estimations are done by employing Bayesian hierarchical model.
Findings
The paper reveals statistically significant temporal changes in the joint distribution of weather variables and wheat yields for grain‐producing farms in Kazakhstan over the period from 1961 to 2003.
Research limitations/implications
By questioning its basic assumption the paper draws attention to serious limitations in the current methodology of the weather‐based insurance design.
Practical implications
The empirical results obtained indicate that the relationship between weather and crop yields is not fixed and can change over time. Accordingly, greater effort is required to capture potential temporal changes in the weather‐yield‐relationship and to consider them while developing and rating weather‐based insurance instruments.
Originality/value
The estimation of selected copula and regression models has been done by employing Bayesian hierarchical models.