With big data come big problems: pitfalls in measuring basis risk for crop index insurance
大数据也有大问题:作物指数保险基差风险测量的陷阱
New satellite sensors will soon make it possible to estimate field-level crop yields, showing a great potential for agricultural index insurance. This paper identifies an important threat to better insurance from these new technologies: data with many fields and few years can yield downward biased estimates of basis risk, a fundamental metric in index insurance. To demonstrate this bias, we use state-of-the-art satellite-based data on agricultural yields in the US and in…