Table 1. Tobit Model Estimates of Insurance Demand Equations: Cost of Production Options
|
65% Coverage |
75% Coverage |
85% Coverage | ||||
|
Variable |
Estimates2 |
t-ratio |
Estimate |
t-ratio |
Estimate |
t-ratio |
|
Constant1 |
-0.1425 |
-1.3920 |
-0.0163 |
-0.1090 |
-0.1110 |
-1.0660 |
|
Contract |
0.0822* |
2.6710 |
0.0612 |
1.3750 |
0.1049* |
3.3240 |
|
History |
0.0199 |
0.6760 |
-0.0463 |
-1.1210 |
0.0059 |
0.2000 |
|
Program |
-0.0565* |
-2.0290 |
-0.0661* |
-1.6620 |
-0.0610* |
-2.1790 |
|
Off farm Inc |
-9.1275 |
-0.1240 |
0.4597 |
0.0040 |
1.8007 |
0.2290 |
|
Debt Ratio |
-1.5334 |
-1.4860 |
-1.2232 |
-0.7920 |
-1.4384 |
-1.3080 |
|
Age |
0.0389* |
2.3950 |
0.0350 |
1.4780 |
0.0552* |
3.3250 |
|
Education |
-0.0126 |
-0.9190 |
-0.0272 |
-1.3600 |
-0.0262* |
-1.8690 |
|
Num. Crops |
8.5981 |
0.8830 |
1.3218 |
0.9040 |
1.3700 |
1.3140 |
|
Distance |
0.2407 |
0.9490 |
-0.1362 |
-0.6630 |
-0.1132 |
-0.7720 |
|
Irrigation |
-0.0479* |
-1.6200 |
-0.0427 |
-1.0030 |
-0.0440 |
-1.4730 |
|
Risk Att. |
0.0214* |
1.7840 |
0.0227 |
1.2870 |
0.0152 |
1.2370 |
|
Efficiency |
-0.0451 |
-1.3440 |
-0.0395* |
-1.7860 |
-0.0270* |
-1.7730 |
|
Yield Risk |
-0.3895 |
-0.4220 |
0.4681 |
0.9500 |
0.4023 |
1.1480 |
|
E[P] |
0.2103 |
0.1730 |
1.6730 |
1.0170 |
4.5461 |
0.4090 |
|
σ |
0.0906* |
9.0780 |
0.1363* |
9.9060 |
0.0974* |
10.6050 |
|
R2 |
33.8% |
22.8% |
34.7% | |||
A single asterisk indicates significance at a 5% level. Variable definitions are provided in the text, whiise
the estimated variance. Note that the parameters have been scaled for presentation purposes: Off farm income by 10
debt ratio by 105, number of crops by 1(7, distance by 10l, yield risk by 1(5 , and E[P] by 1(6.
2
The marginal effects of each explanatory vanable on the willingness to pay is given by:
where Φ is the normal distribution function, is the vector of willingness’ to pay
∂E[y∖x] / ∂x = Φ ( β 'x / σ )β,
13