DETERMINANTS OF FOOD INDUSTRY PERFORMANCE – SURVEY DATA AND REGRESSIONS FOR DENMARK

W.H. Furtan and Johannes Fritz Sauer

No 36851, 82nd Annual Conference, March 31 - April 2, 2008, Royal Agricultural College, Cirencester, UK from Agricultural Economics Society

Abstract: This paper investigates empirically the determinants of firms’ performance in the agrifood sector by using recent survey data for Denmark. Treating sales per employee as a proxy for value added we estimate several bootstrapped regression models to draw conclusions on the marginal effects of potential performance determinants such as the form and nature of ownership, stage of the food chain and commodity sector, new product development, staff quality, firms’ competitive stance, and elements of firms’ strategy. To draw robust inferences we apply, besides the ordinary heteroscedasticity corrected Tobit ML-estimator, a nonparametric least absolute deviations estimator (LAD/CLAD) based on a quantile regression procedure. The results indicate that we cannot reject the hypothesis of no influence of dominant orientation on value added. Rather, firms’ focus on human capital, stage and commodity sector better explains their value addition. We reject the hypothesis that regional networks have no influence on value added. Location in à rhus, emphasis on human capital and the negative influence of outsourcing on value added all provide supporting evidence. We reject the hypothesis of no influence of FDI, and moreover propose that FDI has targeted the domestic Danish market as a source of value added.

Keywords: value added; innovation; organizational type; Food Consumption/Nutrition/Food Safety; Q13; O31; O33 (search for similar items in EconPapers)
Date: 2008-03-30
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