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Macroeconomic Factors and the Thoroughbred Industry

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  • Karungu, Peter
  • Reed, Michael
  • Tvedt, Douglas

Abstract

A capitalization approach is used to estimate econometrically the effects of exchange rate, interest rate and tax law changes on thoroughbred yearling prices. The analysis found that exchange rate and tax law changes have significantly influenced yearling prices since the early 1980s. Another serious price-reducing event was the 1986 tax law change. Both of these factors have counteracted the positive impact of increased purse rates on yearling prices.

Suggested Citation

  • Karungu, Peter & Reed, Michael & Tvedt, Douglas, 1993. "Macroeconomic Factors and the Thoroughbred Industry," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 25(1), pages 165-173, July.
    • Handle: RePEc:cup:jagaec:v:25:y:1993:i:01:p:165-173_01
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    References listed on IDEAS

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    1. Orden, David, 1986. "Agriculture, trade, and macroeconomics: The U.S. case," Journal of Policy Modeling, Elsevier, vol. 8(1), pages 27-51.
    2. Paul R. Johnson & Thomas Grennes & Marie Thursby, 1977. "Devaluation, Foreign Trade Controls, and Domestic Wheat Prices," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 59(4), pages 619-627.
    3. Robert G. Chambers, 1984. "Agricultural and Financial Market Interdependence in the Short Run," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 66(1), pages 12-24.
    4. G. Edward Schuh, 1974. "The Exchange Rate and U. S. Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 56(1), pages 1-13.
    5. David A. Bessler, 1984. "Relative Prices and Money: A Vector Autoregression on Brazilian Data," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 66(1), pages 25-30.
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    1. Jenna Bryant & C. Jill Stowe, 2020. "Estimated Profitability of Thoroughbred Yearlings Sold in Auctions in the United States, 2001–2018," Sustainability, MDPI, vol. 12(2), pages 1-13, January.
    2. Conor Parsons & Ian Smith, 2008. "The Price of Thoroughbred Yearlings in Britain," Journal of Sports Economics, , vol. 9(1), pages 43-66, February.
    3. J. Shannon Neibergs, 2001. "A hedonic price analysis of thoroughbred broodmare characteristics," Agribusiness, John Wiley & Sons, Ltd., vol. 17(2), pages 299-314.
    4. Vickner, Steven S. & Koch, Stephen I., 2001. "Hedonic Pricing, Information, And The Market For Thoroughbred Yearlings," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 19(2), pages 1-17.
    5. Poerwanto, Devie A. & Stowe, C. Jill, 2010. "The Relationship Between Sire Representation and Average Yearling Prices in the Thoroughbred Industry," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 28(01), pages 1-14.

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