The Income Stabilization Tool: Assessing the Hypothesis of a National Mutual Fund in Italy

Abstract

With the gradual phasing out of guarantees provided by the CAP to European farmers in terms of the stabilization of markets, the issue of risk management tools has gradually acquired an ever-higher profile that has resulted in a series of innovations that initially enlivened the 2009 Health Check followed by the proposed Commission regulation for rural development policy 2014-2020. In particular, the latter introduces a new measure, called the Income Stabilization Tool (IST), aimed at supporting income risk management for agricultural enterprises through the use of mutual funds. The aim of this work is twofold; to emphasize the need of new regulation aimed to foster the implementation of the IST and to assess the public cost associated by estimates the farmer demand for the tool.