IDEAS home Printed from https://ideas.repec.org/a/ags/joaaec/15165.html
   My bibliography  Save this article

The Effects Of Holding Nonfarm Related Financial Assets On Risk-Adjusted Farm Income

Author

Listed:
  • Betubiza, Eustacius N.
  • Leatham, David J.

Abstract

A discrete stochastic, programming model is formulated to study the gains from diversification when farming operations are augmented with off-farm financial assets that are not highly correlated with returns from farming. We extend past research by considering the dynamics of accumulating these financial assets and the farm's leverage and tenure position. Results show that farmers' income level and stability can be improved by including nonfarm financial assets in their portfolios.

Suggested Citation

  • Betubiza, Eustacius N. & Leatham, David J., 1994. "The Effects Of Holding Nonfarm Related Financial Assets On Risk-Adjusted Farm Income," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 26, pages 1-15, December.
    • Handle: RePEc:ags:joaaec:15165
    DOI: 10.22004/ag.econ.15165
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/15165/files/26020565.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.15165?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. David J. Leatham & Timothy G. Baker, 1988. "Farmers' Choice of Fixed and Adjustable Interest Rate Loans," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 70(4), pages 803-812.
    2. Featherstone, Allen M. & Baker, Timothy G., 1986. "Farm Portfolio Adjustments To The Elimination Of U.S. Target And Support Price Provisions," 1986 Regional Committee NC-161, October 7-8, 1986, St. Paul, Minnesota 127210, Regional Research Committee NC-1014: Agricultural and Rural Finance Markets in Transition.
    3. McCarl, Bruce A., 1986. "Innovations In Programming Techniques For Risk Analysis," Regional Research Projects > 1986: S-180 Annual Meeting, March 23-26, 1986, Tampa, Florida 271825, Regional Research Projects > S-180: An Economic Analysis of Risk Management Strategies for Agricultural Production Firms.
    4. Bruce A. McCarl & David A. Bessler, 1989. "Estimating An Upper Bound On The Pratt Risk A Version Coefficient When The Utility Function Is Unknown," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 33(1), pages 56-63, April.
    5. 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.
    6. K. D. Cocks, 1968. "Discrete Stochastic Programming," Management Science, INFORMS, vol. 15(1), pages 72-79, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Apland, Jeffrey & Hauer, Grant, 1993. "Discrete Stochastic Programming: Concepts, Examples And A Review Of Empirical Applications," Staff Papers 13793, University of Minnesota, Department of Applied Economics.
    2. Kanakasabai, Murali & Dillon, Carl R., 2004. "Potential For Farm Adaptation To Global Climatic Change In Kentucky," 2004 Annual meeting, August 1-4, Denver, CO 20422, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. Misra, Sukant K. & Spurlock, Stanley R., 1991. "Incorporating The Impacts Of Uncertain Fieldwork Time On Whole-Farm Risk-Return Levels: A Target Motad Approach," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 23(2), pages 1-10, December.
    4. Dillon, Carl R. & Shearer, Scott A. & Mueller, Thomas, 2001. "A Mixed Integer, Nonlinear Programming Model Of Innovative Variable Rate Planting Date With Polymer Seed Coatings," 2001 Annual meeting, August 5-8, Chicago, IL 20572, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Paris, Quirino, 1978. "Revenue And Cost Uncertainty, Generalized Mean-Variance And The Linear Complementarity Problem," Working Papers 225635, University of California, Davis, Department of Agricultural and Resource Economics.
    6. Anissa Chaibi & Maria-Lenuta Ciupac-Ulici & Mircea-Cristian Gherman, 2014. "Do Recent Stochastic Tools Help to Better Understand Investors Preference and Asset Allocation?," Working Papers 2014-130, Department of Research, Ipag Business School.
    7. Jones, Jason P.H. & McCarl, Bruce A., 2016. "Impacts of U.S. Production-Dependent Ethanol Policy on Agricultural Markets," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 236258, Agricultural and Applied Economics Association.
    8. Timothy J. Lowe & Paul V. Preckel, 2004. "Decision Technologies for Agribusiness Problems: A Brief Review of Selected Literature and a Call for Research," Manufacturing & Service Operations Management, INFORMS, vol. 6(3), pages 201-208.
    9. King, Robert P., 1979. "Operational Techniques for Applied Decision Analysis Under Uncertainty," AAEA Fellows - Dissertations and Theses, Agricultural and Applied Economics Association, number 181951, March.
    10. Tice, Thomas F. & Clouser, Rodney L., 1980. "Stochastic Effect Of Weather On Crop Production The Value Of Weather Information To Individual Corn Producers," 1980 Annual Meeting, July 27-30, Urbana-Champaign, Illinois 278479, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    11. Brent A. Gloy & Timothy G. Baker, 2002. "The Importance of Financial Leverage and Risk Aversion in Risk-Management Strategy Selection," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(4), pages 1130-1143.
    12. Dorfman, Jeffrey H. & Pennings, Joost M.E. & Philip Garcia, 2010. "Is Hedging a Habit? Hedging Ratio Determination of Cotton Producers," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 28(01).
    13. Vassalos, Michael & Dillon, Carl R. & Coolong, Tim, 2012. "Choice of Optimal Planting and Marketing Decisions for Fresh Vegetable Producers: A Mathematical Programming Approach," 2012 Annual Meeting, February 4-7, 2012, Birmingham, Alabama 120016, Southern Agricultural Economics Association.
    14. Taylor, R. Garth & Young, Robert A., 1995. "Rural-To-Urban Water Transfers: Measuring Direct Foregone Benefits Of Irrigation Water Under Uncertain Water Supplies," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 20(2), pages 1-16, December.
    15. King, Robert P. & Robison, Lindon J., 1980. "Implementing Stochastic Dominance With Respect To A Function," Risk Analysis in Agriculture: Research and Educational Developments, January 16-18, 1980, Tucson, Arizona 271563, Regional Research Projects > W-149: An Economic Evaluation of Managing Market Risks in Agriculture.
    16. Williams, R. Lynn & Dillion, Carl R. & McCarl, Bruce A., 1992. "An Economic Investigation of Edwards Aquifer Water Use Tradeoffs," WAEA/ WFEA Conference Archive (1929-1995) 321395, Western Agricultural Economics Association.
    17. repec:bla:canjag:v:58:y:2010:i:s1:p:531-554 is not listed on IDEAS
    18. Greiner, Romy, 1998. "Catchment management for dryland salinity control: Model analysis for the Liverpool plains in New South Wales," Agricultural Systems, Elsevier, vol. 56(2), pages 225-251, February.
    19. Davis, Todd & Jaromczyk, Jerzy & Mark, Tyler, 2018. "Potential Crop Rotation and Insurance Adoption Response to Changes in the Federal Crop Insurance Program," 2018 Annual Meeting, February 2-6, 2018, Jacksonville, Florida 266664, Southern Agricultural Economics Association.
    20. Jeffrey Harrison & Matthew Hart & Derek Oler, 2014. "Leverage and acquisition performance," Review of Quantitative Finance and Accounting, Springer, vol. 43(3), pages 571-603, October.
    21. Elbakidze, Levan & McCarl, Bruce A., 2006. "Animal Disease Pre-Event Preparedness versus Post-Event Response: When Is It Economic to Protect?," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 38(2), pages 327-336, August.

    More about this item

    Keywords

    Agricultural Finance;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:joaaec:15165. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/saeaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.