Investigation of Dependence Structure and Simulation of Rainfed Wheat Yield and Weather Variables in Miyaneh County: Application of C-Vine Copula Approach

Weather-based crop insurance is one of the best insurance systems in which it is required to simulate production yield with respect to weather variables and explaining of dependence structure to compute premium. The evaluation of dependence structure with consideration of simultaneous impact of variables using vine copula can provide more appropriate results. Therefore, in this study, the dependence structure between weather variables and rainfed wheat yield with utilization of canonical vine copula functions (C-vine) was measured and then yield of rainfed wheat in Miyaneh County has simulated. The result showed that most of the investigated variables have dependency in lower tail; in the other word, they are more impressible in small amounts than big amounts. Hence, the mean amount of simulated rainfed wheat yield was 871.6839 kg per hectare so that these results can be used in expected loss and premium calculation.