Analysis reveals combining crop diversification and yield insurance reduces weather-related yield risks in agriculture, suggesting enhanced resilience for farmers.
• Weather risks in German agriculture vary greatly from region to region, and droughts have been the weather risk with the highest monetary losses between 1995 and 2019. • Growing multiple crops is often an effective strategy for significantly reducing a farm's overall yield risk in the event of drought. • Multiple-yield insurance is one way of making yield insurance more affordable for farms with diverse crop rotations.
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Schmitt et al. (2024) studied this question.
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