Cross-Commodity Perspective on Contracting: Evidenc e from Mississippi
Pr(CON = 1) = f(CV P; HOURS;P REF; EASE; ASSET SP; EDU; OF FINC; AGE);
where CON = 1 if the producer is engaged in contract agricultural pro duction for their
primary product; CON = 0 otherwise. In the first estimated model, contract production
was assumed to be cash forward contracts, marketing pools, resource providing contracts,
and production management contracts. The variables PREF and EASE are Liekert scale
questions.
• PREF - “I prefer to concentrate on farming/producing relative to marketing my prod-
ucts.”
• EASE - “C ontracting is easier to do than sell my products in the open market.”
These variables were scaled as 1 being strongly agree to 5 being strongly disagree to these
statements. EDU is the level of education of the respondent: EDU = 1 if respondent was a
college graduate; EDU = 0 otherwise. Finally, AGE is the age of the respondent in years.
The results of the regression model are presented in Table 5. The results suggest that
price risk is not an important factor in determining contract participation, which appears
consistent with the results above. These results also lend further support to the hypothesis
of Allen and Lueck that risk is not important in contracting. It is important to note that
this does not mean that producers are risk neutral, it simply implies that other factors are
more imp ortant than price risk in participation in contracting.
The coe¢cient on the HOURS variable is positive and statistically significant, sug-
13
More intriguing information
1. Policy Formulation, Implementation and Feedback in EU Merger Control2. EU enlargement and environmental policy
3. The name is absent
4. Herman Melville and the Problem of Evil
5. Before and After the Hartz Reforms: The Performance of Active Labour Market Policy in Germany
6. Income Mobility of Owners of Small Businesses when Boundaries between Occupations are Vague
7. SAEA EDITOR'S REPORT, FEBRUARY 1988
8. he Virtual Playground: an Educational Virtual Reality Environment for Evaluating Interactivity and Conceptual Learning
9. Direct observations of the kinetics of migrating T-cells suggest active retention by endothelial cells with continual bidirectional migration
10. Why unwinding preferences is not the same as liberalisation: the case of sugar