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Machinery Investment in Illinois: A Study Examining Existing Investment Motivations

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  • Micheels, Eric T.
  • Katchova, Ani L.
  • Barry, Peter J.

Abstract

In this study, we attempt to prove some previously held ideas of machinery investment decisions using farm level data from Illinois. Investment decisions are analyzed taking into consideration past investment decisions in the county and on the individual farm. The results show there is a correlation between county level purchases and individual farm purchases and investment levels decrease the following year after an initial investment. These results display how non-traditional drivers for investment also play an important role in the investment decision.

Suggested Citation

  • Micheels, Eric T. & Katchova, Ani L. & Barry, Peter J., 2004. "Machinery Investment in Illinois: A Study Examining Existing Investment Motivations," 2004 Annual meeting, August 1-4, Denver, CO 20374, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea04:20374
    DOI: 10.22004/ag.econ.20374
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    References listed on IDEAS

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    1. Peter J. Barry & Ralph W. Bierlen & Narda L. Sotomayor, 2000. "Financial Structure of Farm Businesses under Imperfect Capital Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(4), pages 920-933.
    2. Gustafson, Cole R. & Barry, Peter J. & Sonka, Steven T., 1988. "Machinery Investment Decisions: A Simulated Analysis For Cash Grain Farms," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 13(2), pages 1-10, December.
    3. Batterham, Robert L. & Fraser, K.I., 1995. "Capital Equipment Replacement Decisions," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 63(01), pages 1-8, April.
    4. Ralph Bierlen & Allen M. Featherstone, 1998. "Fundamental q, Cash Flow, and Investment: Evidence from Farm Panel Data," The Review of Economics and Statistics, MIT Press, vol. 80(3), pages 427-435, August.
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    Cited by:

    1. Hadrich, Joleen C. & Larsen, Ryan A. & Olson, Frayne E., 2012. "Incentives for Machinery Investment," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124897, Agricultural and Applied Economics Association.

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