Do agricultural households share risks in Thailand? Evidence from Thai socio-economic panel survey data

Abstract

For this paper, three waves of the Thai Socio-Economic Panel Survey data which cover the years 2005-2007, are used for the first time to examine risk sharing through many specifications. The findings show that the null hypothesis of full insurance against income shock is rejected for the whole country case together with a group consisting of a sample from the Central, Eastern and Western regions. This rejection, nevertheless, is supported by the existence of evidence of partial insurance for the whole country case. Unlike income shock, a specific adverse shock, which uses the illness of the household head as a proxy, is fully insured by households for all region groups except a group consisting of a sample from the Central, Eastern and Western regions.