CROSS-COMMODITY PERSPECTIVE ON CONTRACTING: EVIDENCE FROM MISSISSIPPI

provided by Research Papers in Economics

Cross-Commodity Perspective on

Contracting: Evidence from Mississippi*

Darren Hudson

Department of Agricultural Economics

Mississippi State University

Octob er 2001

Research Report 2001-09

Abstract

This anal ysis pre sents the res ults of a survey of agric ultural producers in Mississipp i
regarding their use of contracting. The study focuses on cross-commodity differences
in c ontra cting and the variable underlying contracting. Logistic regression mod els are
used to examine the impacts of variables co ming from transactio ns cost economics and
risk on contracting d ecisions.   Supp ort is found for the effects of transactions cost,

but price risk is not found to be an imp ortant determinant of contracting decisions.
Keywords: contracting, transactions cost, risk, logistic regression, surveys

* Hudson is Associate Professor, Department of Agricultural Economics, Mississippi State University. This
research was funded by a U.S. Department of Agriculture National Research Iniative Grant #00-35400-
9253.  The author thanks Tommy Gregory and David Laughlin for assistance in questionnaire design and

administration. The author also acknowledges the comments of Bill Herndon, John Anderson, and Warren
Couvillion. All remaining errors are the author’s responsibility. The author can be reached at Box 5187,
Mississippi State, MS, 39759, 662-325-7998, hudson@agecon.msstate.edu. Copyright °c 2001 by Darren
Hudson.  All rights reserved.  Readers may make verbatim copies of this document for non-commercial

purposed by any means, provided that this copyright notice appears on all such copies.

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