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Effect of Variable Interest Rate Loans on the Agricultural Sector

Author

Listed:
  • Herr, William McD.
  • Shumaker, George A.
  • Solverson, Lyle
  • Dougherty, Thomas J.
  • Langrehr, Staurt

Abstract

Variable interest rates shift the risk of interest rate changes from the lender to the borrower. Various agribusiness firms and the agricultural sector were analysed to determine whether variable rates contribute significantly to fluctuations in net cash income. Results indicate that variable rates increase the instability of net cash flows for major mid-west farm types and but not for farmer owner cooperatives.

Suggested Citation

  • Herr, William McD. & Shumaker, George A. & Solverson, Lyle & Dougherty, Thomas J. & Langrehr, Staurt, 1981. "Effect of Variable Interest Rate Loans on the Agricultural Sector," 1981 Annual Meeting, July 26-29, Clemson, South Carolina 279276, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea81:279276
    DOI: 10.22004/ag.econ.279276
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    References listed on IDEAS

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    1. Morris, James R, 1976. "On Corporate Debt Maturity Strategies," Journal of Finance, American Finance Association, vol. 31(1), pages 29-37, March.
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    Cited by:

    1. Moe, Lonn & Thompson, Jerry L., 1984. "Cash Flow Implications Of Fixed Versus Variable Interest Rate Debt Structures," Staff Papers 13470, University of Minnesota, Department of Applied Economics.

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    Keywords

    Agricultural Finance;

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