Contract and Exit Decisions in Finisher Hog Production
AbstractFinisher hog production in North America has shifted toward larger units and contract format since 1990. Exit among independent growers has been high. We develop a model showing that growers with any of three efficiency attributes (lower innate hazard of exit, variable costs, or contract adoption costs) are more likely to contract, produce more, and expend more on business protection. Using 2004 Agricultural Resource Management Survey data, a recursive bivariate probit model confirms that contracting producers are less likely to exit. Specialization increases the probability of contracting. Education, nonfarm income, and older production facilities are significant in increasing expected exit. Copyright 2010, Oxford University Press.
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Bibliographic InfoArticle provided by Agricultural and Applied Economics Association in its journal American Journal of Agricultural Economics.
Volume (Year): 92 (2010)
Issue (Month): 3 ()
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Other versions of this item:
- Dong, Fengxia & Hennessy, David A. & Jensen, Helen H., 2010. "Contract and Exit Decisions in Finisher Hog Production," Staff General Research Papers 31302, Iowa State University, Department of Economics.
- Fengxia Dong & David A. Hennessy & Helen H. Jensen, 2008. "Contract and Exit Decisions in Finisher Hog Production," Center for Agricultural and Rural Development (CARD) Publications 08-wp469, Center for Agricultural and Rural Development (CARD) at Iowa State University.
- Dong, Fengxia & Hennessy, David A. & Jensen, Helen H., 2009. "Contract and Exit Decisions in Finisher Hog Production," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49343, Agricultural and Applied Economics Association.
- D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
- Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
- J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
- J43 - Labor and Demographic Economics - - Particular Labor Markets - - - Agricultural Labor Markets
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Väre, Minna & Heshmati, Almas, 2004. "Perspectives on the Early Retirement Decisions of Farming Couples," IZA Discussion Papers 1342, Institute for the Study of Labor (IZA).
- Kuo-Liang Chang & George Langelett & Andrew Waugh, 2011. "Health, Health Insurance, and Decision to Exit from Farming," Journal of Family and Economic Issues, Springer, vol. 32(2), pages 356-372, June.
- Dong, Fengxia & Hennessy, David & Jensen, Helen H., 2013. "Size, Productivity and Exit Decisions in Dairy Farms," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150339, Agricultural and Applied Economics Association.
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