Does crop insurance impact water use?

June 28, 2018

Does crop insurance impact water use?

Although crop insurance was not designed to impact water resources, it may have unintended consequences for water use, because agriculture and water resources are tightly linked. In particular, crop production relies on water as an input, and irrigation for crop production is the largest user of water resources. Thus, if crop insurance changes farmer behavior, it may affect water use as well. Crop insurance is expected to become more important to farmers in the future, as the frequency of production losses increase under a changing climate, such as from droughts, floods, or pest outbreaks. At the same time, a changing climate will affect the availability of water resources. For these reasons, it is important to understand the relationship between crop insurance, agriculture, and water use.


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Research Area: Economic Policy

Policy Initiative: Climate Policy

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