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Research in Agricultural Futures Markets: Integrating the Finance and Marketing Approach

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  • Pennings, Joost M.E.
  • Egelkraut, Thorsten M.

Abstract

In a brief literature review, we discuss how our insight into the grounds of existence of futures markets has changed from the initial insurance perspective, to the arbitrage perspective, to the portfolio perspective, and to the current institutional perspective. We discuss futures market research within agricultural marketing, on the one hand, and within finance, on the other hand. The research within these two disciplines may be considered complementary. Subsequently, a new research model is presented which integrates both strains of research. The new research model is illustrated for the Dutch hog industry. This model is a powerful instrument in the development of new commodity futures contracts. Finally, a future research agenda for agricultural economists is presented.

Suggested Citation

  • Pennings, Joost M.E. & Egelkraut, Thorsten M., 2003. "Research in Agricultural Futures Markets: Integrating the Finance and Marketing Approach," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 52(06), pages 1-9.
    • Handle: RePEc:ags:gjagec:97980
    DOI: 10.22004/ag.econ.97980
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    1. Calum G. Turvey & Timothy G. Baker, 1990. "A Farm-Level Financial Analysis of Farmers' Use of Futures and Options under Alternative Farm Programs," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(4), pages 946-957.
    2. Pennings, Joost M. E. & Garcia, Philip, 2004. "Hedging behavior in small and medium-sized enterprises: The role of unobserved heterogeneity," Journal of Banking & Finance, Elsevier, vol. 28(5), pages 951-978, May.
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    Cited by:

    1. Atle Oglend & Hans‐Martin Straume, 2020. "Futures market hedging efficiency in a new futures exchange: Effects of trade partner diversification," Journal of Futures Markets, John Wiley & Sons, Ltd., vol. 40(4), pages 617-631, April.
    2. Anna Szczepańska-Przekota, 2022. "Causality in Relation to Futures and Cash Prices in the Wheat Market," Agriculture, MDPI, vol. 12(6), pages 1-10, June.

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