IDEAS home Printed from https://ideas.repec.org/a/ags/sojoae/30366.html
   My bibliography  Save this article

Measuring The Effect Of Capital Structure And Seasonality On Expected Returns And Risk: The Fresh Market Vegetable Case

Author

Listed:
  • Prevatt, J. Walter
  • Bauer, Larry L.
  • Kaiser, Eddie H.
  • Rathwell, P. James

Abstract

The effect of capital structure and seasonality of fresh market vegetables was examined via the Target MOTAD model. The level of capital indebtedness and the selection of either a fall or spring season resulted in significantly different levels of enterprise mixes, expected returns, risk magnitudes, rates of change of risk magnitudes, and operating capital requirements. The fall season demonstrated larger initial levels of risk and larger increases in the level of risk due to increases in indebtedness. The spring season showed larger increases in risk between minimum risk point and the maximum expected return point (linear programming solution) on the risk-efficient frontier. Operating capital requirements were substantially higher for the fall season than for the spring season. The operating capital requirements of the spring season were significantly affected by the level of indebtedness and the magnitude of risk selected by the grower, while the larger operating capital requirements of the fall season were only marginally affected.

Suggested Citation

  • Prevatt, J. Walter & Bauer, Larry L. & Kaiser, Eddie H. & Rathwell, P. James, 1992. "Measuring The Effect Of Capital Structure And Seasonality On Expected Returns And Risk: The Fresh Market Vegetable Case," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 24(1), pages 1-8, July.
  • Handle: RePEc:ags:sojoae:30366
    DOI: 10.22004/ag.econ.30366
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/30366/files/24010171.pdf
    Download Restriction: no

    File URL: https://libkey.io/10.22004/ag.econ.30366?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
    ---><---

    References listed on IDEAS

    as
    1. Colette, W. Arden & Wall, G. Bryan, 1978. "Evaluating Vegetable Production For Market Windows As An Alternative For Limited Resource Farmers," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 10(2), pages 1-5, December.
    2. Babb, Emerson M. & Long, Burl F., 1987. "The Role Of Alternative Agricultural Enterprises In A Changing Agricultural Economy," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 19(1), pages 1-9, July.
    3. Zimet, David J. & Spreen, Thomas H., 1986. "A Target Motad Analysis of a Crop and Livestock Farm in Jefferson County, Florida," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 18(2), pages 175-186, December.
    4. McKinnell, Cathy S. & Kahl, Kandice H. & Curtis, Charles E., Jr., 1990. "A Regional Comparison Of Risk-Efficient Soybean Marketing Strategies," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 22(1), pages 1-10, July.
    5. Babb, E. M. & Long, B. F., 1987. "The Role of Alternative Agricultural Enterprises in a Changing Agricultural Economy," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 19(1), pages 7-16, July.
    6. Colette, W. Arden & Wall, G. Brian, 1978. "Evaluating Vegetable Production for Market Windows as an Alternative for Limited Resource Farmers," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 10(2), pages 189-193, December.
    7. Collette, Ardea & Wall, G. Brian, 1978. "Is Production For Market Windows A Viable Alternative For Limited Resource Farmers," 1978 Annual Meeting, August 6-9, Blacksburg, Virginia 284201, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Vieth, Gary R. & Suppapanya, Pramote, 1996. "An Evaluation Of Selected Decision Models: A Case Of Crop Choice In Northern Thailand," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 28(2), pages 1-11, December.

    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. Tronstad, Russell, 1995. "Importance Of Melon Type, Size, Grade, Container, And Season In Determining Melon Prices," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 20(1), pages 1-10, July.
    2. Hinson, Roger A. & Lee, John G. & Huh, Mooyul, 1990. "Evaluation Of Selected Fresh Vegetable Terminal Markets: A Stochastic Dominance Approach," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 22(2), pages 1-10, December.
    3. Farmer, Douglas L. & Alipoe, Dovi & Hughes, Carl R., 2000. "Terminal Market Windows For Mississippi Small-Farm Vegetable Producers," Journal of Food Distribution Research, Food Distribution Research Society, vol. 31(1), pages 1-6, March.
    4. Hemachandra, Dilini & Kodithuwakku, Sarath S., 2006. "Business Orientation among Poor Dry Zone Farmers in Sri Lanka," Sri Lankan Journal of Agricultural Economics, Sri Lanka Agricultural Economics Association (SAEA), vol. 8, pages 1-19.
    5. Tronstad, Russell & Huthoefer, Lori Stephens & Monke, Eric A., 1992. "Market Windows And Hedonic Price Analyses: An Application To The Apple Insdustry," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 17(2), pages 1-9, December.
    6. Adrian, John L., Jr. & Upshaw, Cran & Mook, Richard, 1989. "Evaluation Of Feasibility Of Fruit And Vegetable Crops Using Market Window Analysis," Journal of Food Distribution Research, Food Distribution Research Society, vol. 20(1), pages 1-11, February.
    7. Henneberry, Shida Rastegari & Kang, Taehoon, 1992. "Potential Markets For Oklahoma Produce: A Market Window Analysis," Journal of Food Distribution Research, Food Distribution Research Society, vol. 23(3), pages 1-18, September.
    8. McLean-Meyinsse, Patricia E., 2000. "Assessing The Market Outlook For Rabbit Meat In Louisiana And Texas," Journal of Food Distribution Research, Food Distribution Research Society, vol. 31(1), pages 1-6, March.
    9. Damianos, Dimitrios & Skuras, Dimitrios, 1996. "Unconventional adjustment strategies for rural households in the less developed areas in Greece," Agricultural Economics, Blackwell, vol. 15(1), pages 61-72, September.
    10. Batie, Sandra S., 1988. "Agriculture As The Problem: New Agendas And New Opportunities," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 20(1), pages 1-11, July.
    11. Moffitt, L. Joe, 1990. "Management decisions for alternative agriculture," Agricultural Outlook Forum Archive 1923 - 1997 326666, United States Department of Agriculture, Agricultural Outlook Forum.
    12. Zwingli, Michael E. & Hardy, William E., Jr. & Adrian, John L., Jr., 1989. "Reduced Risk Rotations For Fresh Vegetable Crops: An Analysis For The Sand Mountain And Tennessee Valley Regions Of Alabama," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 21(2), pages 1-11, December.
    13. Yuanhe Yu & Liang Wang & Jinkuo Lin & Zijun Li, 2022. "Optimizing Agricultural Input and Production for Different Types of at-Risk Peasant Households: An Empirical Study of Typical Counties in the Yimeng Mountain Area of Northern China," IJERPH, MDPI, vol. 19(21), pages 1-22, October.
    14. McLean-Meyinsse, Patricia E., 1999. "An Analysis Of Factors Affecting Consumers' Decisions To Shop At Stores Offering Specialty Meat," Journal of Food Distribution Research, Food Distribution Research Society, vol. 30(1), pages 1-6, March.
    15. Eihab Fathelrahman & Mohamed Gheblawi & Safdar Muhammad & Emily Dunn & James C. Ascough & Timothy R. Green, 2017. "Optimum Returns from Greenhouse Vegetables under Water Quality and Risk Constraints in the United Arab Emirates," Sustainability, MDPI, vol. 9(5), pages 1-11, April.
    16. Davis, Todd D. & Curtis, Charles E., Jr. & Shumaker, George A. & Smith, Nathan B., 2003. "The Effect Of The 2002 Farm Bill On Crop Enterprise Selection In The Southeast Region," 2003 Annual Meeting, February 1-5, 2003, Mobile, Alabama 35207, Southern Agricultural Economics Association.
    17. Marousek, Gerald & Stodick, Leroy & Schimmel, Joe, 1990. "Production And Marketing Alternatives In The Beef Cattle Industry With Risk Considerations," A.E. Research Series 305064, University of Idaho, Department of Agricultural Economics and Rural Sociology.
    18. Harris, Thomas R. & Seung, Chang K. & Narayanan, Rangesan, 2001. "Targeting Economic Diversification: An Application of Target MOTAD Procedures," The Review of Regional Studies, Southern Regional Science Association, vol. 31(2), pages 197-215, Fall.
    19. Marousek, Gerald & Stodick, Leroy, 1991. "Economics of Alternative Beef Cattle Managment/Marketing Systems," WAEA/ WFEA Conference Archive (1929-1995) 321467, Western Agricultural Economics Association.

    More about this item

    Keywords

    Crop Production/Industries;

    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:sojoae:30366. 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.