This paper investigates the effects of crop insurance on agricultural innovation (namely, drought-tolerant traits) in the context of climate change. A conceptual framework is developed to model the market equilibrium of agricultural innovations. Hypotheses derived are then tested by using data for US agriculture. We find that the US agricultural sector responds to climate variation by increasing innovation activities, but this response is weakened by subsidised crop insurance by about 23 per cent. This indicates that crop insurance may have an unintended crowding-out effect as an option of risk management and may inhibit societies’ long-run capacity to adapt to climate change.

中文翻译：

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气候，保险与创新：干旱与美国农业的耐旱性创新

本文研究了气候变化背景下作物保险对农业创新（即耐旱性状）的影响。建立了一个概念框架来对农业创新的市场均衡进行建模。然后使用美国农业数据测试得出的假设。我们发现，美国农业部门通过增加创新活动来应对气候变化，但是这种补贴因补贴作物保险而减弱了约23％。这表明，作物保险作为一种风险管理手段可能会产生意想不到的挤出效应，并可能抑制社会长期适应气候变化的能力。