Hostname: page-component-78c5997874-xbtfd Total loading time: 0 Render date: 2024-11-08T05:31:44.408Z Has data issue: false hasContentIssue false
  • English
  • Français

The Impact of Management on Farm Expansion and Survival

Published online by Cambridge University Press:  28 April 2015

Wesley N. Musser  and
Fred C. White
Wesley N. Musser
Affiliation:
Department of Agricultural Economics, University of Georgia, Athens, Georgia
Fred C. White
Affiliation:
Department of Agricultural Economics, University of Georgia, Athens, Georgia
Get access Rights & Permissions [Opens in a new window]

Extract

Commercial agriculture is undergoing a major structural change in the form of decreasing numbers and increasing sizes of farm units. This structural change results in farm firms constantly experiencing expansion and survival problems. In some cases, expansion and survival are related: growth in size is necessary to incorporate cost-reducing technological improvements to maintain income levels. In others, these problems are separated: expansion is desired to increase income-earning capacity, or survival may be a primary objective for the firm when expansion is unlikely. This paper develops an analytical framework, incorporating the dynamics of expansion and survival, and explores their interrelationships. Stochastic relationships are incorporated for use in conceptualizing simulation studies of firm growth. Its empirical relevance is demonstrated with an analysis of the interaction between managerial ability and leverage in the process of expansion and survival of a representative farm firm in South Central Georgia.

Type
Research Article
Information
Journal of Agricultural and Applied Economics , Volume 7 , Issue 1 , July 1975 , pp. 63 - 69
Copyright
Copyright © Southern Agricultural Economics Association 1975

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

[1] Chang, Anne An-Ning. “Analysis of the Impact of Selected Variables on Farm Growth,” unpublished Master's Thesis, University of Georgia, 1974.Google Scholar
[2] Farm Credit Administration, Research Division, Characteristics of Federal Land Bank Loans, 1972, Statistical Bulletin 5, Washington, D. C., September 1973.Google Scholar
[3] Flaskerud, George K. “Firm Growth Simulation as a Farm Management and Credit Evaluation Device,” unpublished Ph.D. Thesis, Oklahoma State University, July 1970.Google Scholar
[4] Heady, Earl O. Economics of Agricultural Production and Resource Use, Prentice-Hall, Inc., Engle-wood Cliffs, New Jersey, December 1952.Google Scholar
[5] Hinman, H. R. and Hutton, R. F.. “Returns and Risks of Expanding Pennsylvania Dairy Farms with Different Levels of Equity,” American Journal of Agricultural Economics, Vol. 53, No. 4, November 1971.Google Scholar
[6] Johnson, Glenn L., et. ah, A Study of Managerial Processes of Midwestern Farmers, Iowa State University Press, Ames, Iowa, 1961.Google Scholar
[7] Knight, Frank H. Risk, Uncertainty and Profit, Chicago: University of Chicago Press, 1971.Google Scholar
[8] Lin, William, et. al. “An Empirical Test of Utility vs. Profit Maximization in Agricultural Production,” American Journal of Agricultural Economics, Vol. 56, No. 3, August 1974.Google Scholar
[9] Patrick, George F. and Eisgruber, Ludwig M.. “The Impact of Managerial Ability and Capital Structure on Growth of the Farm Firm,” American Journal of Agricultural Economics, Vol. 50, No. 3, August 1968.Google Scholar
[10] U.S. Department of Agriculture, Georgia Crop Reporting Service, Georgia Agriculture Facts, 1957-1963,1959-1966,1964-1972, Athens, Georgia.Google Scholar
[11] U.S. Department of Agriculture, Statistical Reporting Service, Agricultural Prices, Georgia, 1950-1960, 1960-1970, Georgia Crop Reporting Service, Athens, Georgia.Google Scholar
[12] Walker, Odell L. and Martin, James R.. “Firm Growth Research Opportunities and Techniques,” Journal of Farm Economics, Vol. 48, No. 5, December 1966.Google Scholar
[13] Westberry, George O. “Optimum Farm Organizations for Various Sizes of Farms in Economic Area Eight, Georgia,” unpublished Master's Thesis, University of Georgia, 1973.Google Scholar