Duration in Production Contracts

James MacDonald and Penelope J. Korb

No 21112, 2006 Annual meeting, July 23-26, Long Beach, CA from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: We use 2003 and 2004 ARMS data to analyze variations in contract duration among growers of broilers who hold production contracts. Most contracts cover just a single flock, but many extend for 1-2 years, and a significant minority of broiler contracts specify lengths of 5, 10, and even 15 years. We find that grower debt and production volume are inversely related to the choice of a short term (a year or less) contract, while lengthy prior experience with the contractor promotes short term contracts. Some contract terms appear to act as substitutes or complements to duration.

Keywords: Livestock; Production/Industries (search for similar items in EconPapers)
Pages: 17
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea06:21112

DOI: 10.22004/ag.econ.21112

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