The inaccuracy of the Black-Scholes formula arises from two aspects: the formula is for European options while most real option contracts are American; the formula is based on the assumption that underlying asset prices follow a lognormal distribution while in the real world asset prices cannot...

Basis risk has been cited as a primary concern for implementing weather hedges. This studyinvestigates several dimensions of weather basis risk for the U.S. corn market at variouslevels of aggregation. The results suggest that while the degree of geographic basis risk maybe significant in some...

This study examines hedging strategies for commodity processors generally and soybean crushers specifically. Processors require hedging strategies built around processing multiple batches each year. Each batch requires the purchase of inputs, transformation of inputs into outputs, and sale of...

The main question posed in the paper asks why do some cooperative arrangements in agricultural markets survive and succeed and others fail? We define “success” and factors affecting success of cooperation using transaction costs theory and game theory. Transaction costs theory provides...

We examine the interaction of marketing channel members and the influence of these interactions on incentives, coordination costs, and risk allocation strategies in a food marketing channel. For this purpose we specify a three-stage principal-agent marketing channel model involving producers,...

African economies are increasingly confronted with changing food and commodity markets, due to globalisation, economic liberalisation and urbanisation. Subsequently, consumer preferences change. This poses new opportunities but also challenges to small-scale producers, traders and processors...

Der Forschungsschwerpunkt der vorliegenden Arbeit liegt in der empirischen Untersuchung der Nachfragemacht der ukrainischen Milchverarbeitungsindustrie nach Rohmilch. Für die ökonometrische Analyse der Preisbildung auf dem ukrainischen Markt für Rohmilch wurde ein sektorales...