American Journal of Agricultural Economics · 1995 · 163 citations · 2 references
AgricultureAgricultural EconomicsPoultry ScienceBroiler ProductionPoultry BreedingRisk AnalysisBroiler BreedingBroiler Growth PerformanceBroiler Production EconomicsBroiler Production SystemsPoultry ProductionRisk In ProductionAgricultural Price RiskBroiler ChickensPrice Risk AnalysisProduction Risk AnalysisProduction Risk ModellingRisk-shifting BehaviorRisk-shifting IncentivesRisk-shifting Problem
Abstract The contracts used to reward growers of broiler chickens in the United States base pay on a grower's performance relative to other growers. From a panel of data covering seventy‐five growers over four years, we use simulation methods to measure the price and production risk shifted from growers to integrator companies by these contracts. We also decompose the risk in broiler production variability. We conclude that the bulk of the risk in our sample, which is primarily price risk, is shifted from growers through the use of production contracts.
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