[go: up one dir, main page]
More Web Proxy on the site http://driver.im/
IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/59818.html
   My bibliography  Save this paper

Effects of streaming loans for commodity producers

Author

Listed:
  • Bell, Peter Newton
Abstract
This paper analyzes a source of financing for commodity producers known as a streaming loan, where the producer makes periodic payments in proportion to their level of production. Streaming loans functions like a cropshare contract, whereas fixed rate debt is like a wage contract. Thus, producers can reduce the variance of profits by financing with streaming loans rather than debt. I establish this result when commodity prices are constant or random, but independent from the quantity of production.

Suggested Citation

  • Bell, Peter Newton, 2014. "Effects of streaming loans for commodity producers," MPRA Paper 59818, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:59818
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/59818/1/MPRA_paper_59818.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Joseph E. Stiglitz, 2002. "Information and the Change in the Paradigm in Economics," American Economic Review, American Economic Association, vol. 92(3), pages 460-501, June.
    2. Joseph E. Stiglitz, 1974. "Incentives and Risk Sharing in Sharecropping," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 41(2), pages 219-255.
    3. Douglas W. Allen & Dean Lueck, 1993. "Transaction Costs and the Design of Cropshare Contracts," RAND Journal of Economics, The RAND Corporation, vol. 24(1), pages 78-100, Spring.
    4. Hallagan, William S., 1978. "Share contracting for California Gold," Explorations in Economic History, Elsevier, vol. 15(2), pages 196-210, April.
    5. Ricard Gil & Francine Lafontaine, 2012. "Using Revenue Sharing to Implement Flexible Prices: Evidence from Movie Exhibition Contracts," Journal of Industrial Economics, Wiley Blackwell, vol. 60(2), pages 187-219, June.
    6. Douglas W. Allen & Dean Lueck, 2009. "Customs and Incentives in Contracts," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(4), pages 880-894.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bell, Peter Newton, 2018. "Evaluating the Kemess Stream sold by Centerra Gold in 2018," MPRA Paper 87014, University Library of Munich, Germany.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yoder, Jonathan & Hossain, Ishrat & Epplin, Francis & Doye, Damona, 2008. "Contract duration and the division of labor in agricultural land leases," Journal of Economic Behavior & Organization, Elsevier, vol. 65(3-4), pages 714-733, March.
    2. Wang, Sen & Bogle, Tim & van Kooten, G. Cornelis, 2012. "Forestry and the New Institutional Economics," Working Papers 130818, University of Victoria, Resource Economics and Policy.
    3. Luis H. B. Braido, 2008. "Evidence on the Incentive Properties of Share Contracts," Journal of Law and Economics, University of Chicago Press, vol. 51(2), pages 327-349, May.
    4. Qiu, Feng & Goodwin, Barry K. & Gervais, Jean-Philippe, 2011. "An Empirical Investigation of the Linkages between Government Payments and Farmland Leasing Arrangements," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 36(3), pages 1-16.
    5. Roumasset, James A., 1994. "Explaining Diversity In Agricultural Organization: An Agency Perspective," Bulletins 12982, University of Minnesota, Economic Development Center.
    6. Pierre-André Chiappori & Bernard Salanié, 2002. "Testing Contract Theory : A Survey of Some Recent Work," Working Papers 2002-11, Center for Research in Economics and Statistics.
    7. Gebrehiwot, D. & Holden, S.T., 2018. "Variation in output shares and endogenous matching in land rental contracts," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277362, International Association of Agricultural Economists.
    8. Dubois, Pierre, 2002. "Moral hazard, land fertility and sharecropping in a rural area of the Philippines," Journal of Development Economics, Elsevier, vol. 68(1), pages 35-64, June.
    9. Carnaje, Gideon P., 2007. "Contractual Arrangements in Philippine Fisheries," Discussion Papers DP 2007-22, Philippine Institute for Development Studies.
    10. Allen Douglas W. & Lueck Dean, 2018. "The Insight and the Legacy of the Theory of Share Tenancy," Man and the Economy, De Gruyter, vol. 5(1), pages 1-12, June.
    11. Mary A. Burke, 2015. "The distributional effects of contractual norms: the case of cropshare agreements," Working Papers 15-7, Federal Reserve Bank of Boston.
    12. Burnett, Wesley & Szmurlo, Daniel & Callahan, Scott, 2022. "Land tenure and conservation adoption: An analysis of contracts and incentives," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322244, Agricultural and Applied Economics Association.
    13. Jun Yeong Lee & Grant Durbahn & Peter F. Orazem & Wendong Zhang, 2023. "The roles of risk preferences, selection, and uncertain returns on land contracts," Agricultural Economics, International Association of Agricultural Economists, vol. 54(2), pages 220-233, March.
    14. Hensher, David A. & Ho, Chinh & Knowles, Louise, 2016. "Efficient contracting and incentive agreements between regulators and bus operators: The influence of risk preferences of contracting agents on contract choice," Transportation Research Part A: Policy and Practice, Elsevier, vol. 87(C), pages 22-40.
    15. Joseph E. Stiglitz, 2017. "The Revolution of Information Economics: The Past and the Future," NBER Working Papers 23780, National Bureau of Economic Research, Inc.
    16. Ackerberg, Daniel A. & Botticini, Maristella, 2000. "The Choice of Agrarian Contracts in Early Renaissance Tuscany: Risk Sharing, Moral Hazard, or Capital Market Imperfections?," Explorations in Economic History, Elsevier, vol. 37(3), pages 241-257, July.
    17. Mintewab Bezabih, 2009. "Heterogeneous Risk Preferences, Discount Rates and Land Contract Choice in Ethiopia," Journal of Agricultural Economics, Wiley Blackwell, vol. 60(2), pages 402-418, June.
    18. Benito Arruñada & Manuel González, 1997. "How competition controls team production: The case of fishing firms," Economics Working Papers 261, Department of Economics and Business, Universitat Pompeu Fabra.
    19. Johan Petersson & Hans Andersson, 1996. "The Benefits Of Share Contracts: Some European Results," Journal of Agricultural Economics, Wiley Blackwell, vol. 47(1‐4), pages 158-171, January.
    20. Elliott, Matthew & James, Harvey Jr., 2013. "Nature Of The Farm: Revisited," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150726, Agricultural and Applied Economics Association.

    More about this item

    Keywords

    Streaming loan; cropshare; contract; capital structure; profitability.;
    All these keywords.

    JEL classification:

    • D20 - Microeconomics - - Production and Organizations - - - General
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • Q14 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Finance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:59818. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.