Kazakhstan?s agricultural sector plays an important role in the country'seconomy. Not only does it function as an economic output producer, it alsoserves as a social buffer in times of transition to a market economy. Therestructuring process had a strong impact on the economic performance ofagricultural enterprises. As the state no longer functions as a back-up financierin times of economic downturn, farmers have to find their own sustainableinstruments to manage business risks, which are significant in Kazakhstan due tothe acute continental climate and the resulting revenue fluctuations.This thesis is an integral part of the research project "Crop Insurance inKazakhstan ? Options for Building a Sound, Institution Promoting AgriculturalProduction".It aims at shedding light on the question, how farm income can be efficientlystabilized under transition conditions. Furthermore, it will be attempted toanswer following sub-questions by employing a utility-efficient risk programmingmodel to three typical study farms in North, East, and South Kazakhstan:? What are the most efficient income stabilization mechanisms for differentfarm types in Kazakhstan?? How do climatic conditions and yield variability influence the efficiencyof income stabilization instruments?? How do assumptions about the decision-maker behaviour influence thechoice and efficiency of selected farm income stabilisation instruments, e.g.to which extent risk aversion affects the choice of risk managementinstruments in a less developed country with extremely high coefficientsof yield variation and often little diversified production systems?Although insurance solutions to agricultural risk suffer from being prone toasymmetric information problems, their possible impact on risk reduction willbe investigated. Therefore, insurance products, which are able to limit the extentof moral hazard problems will be described and analysed.Additionally to the programming model, a farm survey as well as a stakeholdersurvey among political decision-makers, representatives of insurance companies and public administration and researchers have been carried out. The rationalefor these empirical studies, particularly the farm survey, was to obtain informationabout production risks Kazakhstani farmers face, their attitude towards risk, andthe risk management instruments they apply.Furthermore, answers will be provided to the question how the actual law oncrop insurance in Kazakhstan can profit from findings generated in the courseof this research.Considering the utility-efficiency of different risk management instruments, wecan conclude that the separate regional analysis was a reasonable procedure,because no general recommendations can be derived from the efficiency results.Therefore, conclusions regarding the utility-efficiency of the consideredinsurance instruments will be drawn regionally.A large number of insurance products stabilises income efficiently as can bederived from the utility rankings. However, weather index insurance seems tobe more appropriate in Northern Kazakhstani grain production. Area-yieldinsurance might be a reasonable alternative to weather insurance, since it providesa number of advantages in fighting moral hazard compared to farm yield insurance.Efficiency results as well as the analysis of variation coefficients show itsapplicability for East and South Kazakhstan conditions. However, the advantagesproviding better access to symmetric information should be evaluated against thepotentially lower risk reduction. When introducing area-yield insurance, smallerareas (rayons) as the basis for the calculation of the underlying yield index aresupposed to provide higher risk reductions than larger areas (oblasts).A central conclusion can be derived for all considered study farms simultaneously.The choice of the production technology is the decisive factor in risk management.The result can be connected to the evaluation of risk management responses of thefarm survey. According to the interviewed farmers, the maintenance of capitalreserves and production with low costs are two of the most important objectivesin risk management. As results from the normative decision model show, thesestrategies are not ?first best solutions? for all considered farms. When cropproduction is insured, more intensive production technologies (with higher costs)might be more appropriate than low input technologies.For further research, we can conclude that decision-making conditions andcriteria vary across geographic regions and by farm type; thus, subsequent riskmodels should be adapted to the unique conditions of the research domain becausestandardized modelling formulations can produce spurious results. Obviously, anatural extension of this work is the investigation of other crops and regions. Future research should test the long-term economic potential of alternative cropsunder changing natural conditions and prices. Furthermore, different combinationsof insurance with hedging products can be tested.The hypothesis that crop insurance often supports only large-scale farmers cannotbe rejected when investigating the data on crop insurance market development.One of the reasons for introducing mandatory crop insurance in Kazakhstan wasto provide all farmers with access to insurance, disregarding their risk exposure orthe size of their enterprises. However, insurance companies have less incentivesto insure small, risk-prone farms. The future task of the government will be tofind appropriate enforcement mechanisms to motivate insurance companies toprovide insurance to small farms or to transform the mandatory system into avoluntary one.A further government task involves breaking up the path dependence of cropinsurance. The bad image of the entire insurance industry could be primarilyovercome by setting right the legal framework, the incentives, and enforcementmechanisms. The objective would be to create an insurance system, in whichinsurance companies can generate profits with their clients experiencing justiceand income stabilisation that provides a sound base for the development of economicactivities.To strengthen the link between on-farm risk management and risk-sharing strategies,the government could promote research in agronomic methods to mitigate theeffects of difficult growing conditions. Differences in agro-climatic environmentssuch as soil type and fertility, moisture availability, distribution of weeds, andsusceptibility to erosion should be better taken into consideration whendeveloping new technology recommendations.