This study analyzes dynamic production input factor decisions using the annual Census of Manufacturing firms from Colombia and monthly production data from a glass mould firm. It proposes a model able to explain the mix of smooth and lumpy adjustment and both the static and dynamic interrelation...

Most farmers in South Africa use standard insurance to protect their crops against natural disasterssuch as hail or strong winds. However, no South African insurance contracts exist to compensatefor too much or too little rain (although floods are covered), or which will pay out iftemperatures...

CAT-Bonds und Wetterderivate sind die Endprodukte eines Verbriefungprozesses, der nicht handelbare Risikofaktoren (Wetterschäden oder Naturkatastrophenschäden) in handelbare Finanzanlagen verwandelt. Als Ergebnis sind die Märkte für diese Produkte in der Regel unvollständig. Da geeignete...

Since last decade, weather derivatives have been traded by Chicago Mercantile Exchange(CME) to hedge the weather risk. In addition to HDD,CDD and CAT, which are index written on the temperature in U.S. and Europe, Pacific Rim Index is newly developed and actively traded nowadays. In terms of the...

Different weather events play an important role for industries with profits depending on temperature or other weather conditions. A market for trading on temperature events has recently emerged. The traded financial contracts allowing to transfer weather risks are called weather derivatives. The...

Weather derivatives (WD) are different from most financial derivatives because the underlying weather cannot be traded and therefore cannot be replicated by other financial instruments. The market price of risk (MPR) is an important parameter of the associated equivalent martingale measures used...