摘要
Informal risk sharing within social networks and formal financial contracts both enable households to manage risk. We find that financial contracting reduces participation in social networks. Specifically, increased crop insurance usage decreased local religious adherence and congregation membership in agricultural communities. Our identification utilizes the Federal Crop Insurance Reform Act of 1994 that doubled crop insurance usage nationally within a year, although changes in usage varied across counties. Difference-in-difference and Spatial First Difference tests confirm that households substituted insurance for religiosity. This substitution was associated with reductions in crop diversification and crop yields, indicating an increase in moral hazard.
源语言 | 英语 |
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文章编号 | PII S0022109022000722 |
页数 | 33 |
期刊 | Journal of Financial and Quantitative Analysis |
早期在线日期 | 18 7月 2022 |
DOI | |
出版状态 | 已出版 - 2022 |
Corresponding author email
fyu@ceibs.eduProject sponsor
Chapman UniversityChina Europe International Business School
Erasmus University
成果物的来源
- SSCI
- ABDC-A*
- FT