Time‐varying Hedge Ratios: A Principal‐agent Approach

We use the classic agency model to derive a time‐varying optimal hedge ratio for low‐frequency time‐series data: the type of data used by crop farmers when deciding about production and about their hedging strategy. Rooted in the classic agency framework, the proposed hedge ratio reflects the context of both the crop farmer's decision and the crop farmer's contractual relationships in the marketing channel. An empirical illustration of the Dutch ware potato sector and its futures market in Amsterdam over the period 1971–2003 reveals that the time‐varying optimal hedge ratio decreased from 0.34 in 1971 to 0.24 in 2003. The hedging effectiveness, according to this ratio, is 39%. These estimates conform better with farmers’ interest in using futures contracts for hedging purposes than the much higher estimates obtained when price risk minimisation is the only objective considered.     

Market Performance of Potato Auctions in Bhutan

Abstract

Market performance with respect to a main horticultural export commodity in Bhutan is the subject of this paper. Imperfections in (market) infrastructure and market structure and conduct may prevent an optimal price for farmers. Market performance is assessed by testing the law of one price for this commodity. This is done by testing three series of auction price data on both long-run and short-run price integration. It is concluded that for the period 1996-2000 the auction prices were interrelated both in the long and short run with one of the three auctions as the price-leading market. In contrast, in the period 2001-2005 the market arbitrage process slowed down, indicating the rise of market imperfections. Policy implications are suggested.     

The price path due to order imbalances: evidence from the Amsterdam Agricultural Futures Exchange

The lack of sufficient market depth particularly in many newly initiated futures markets results in relatively high hedging costs, and this inhibits the growth of futures contract volume. In this article the price path due to order imbalances is analyzed and a two-dimensional market depth measure is derived.Understanding the underlying structure of futures market depth provides the management of the futures exchange with a framework for improving their market depth and gives hedgers a better understanding of market depth risk. The managerial implications of our findings are demonstrated empirically using data from the Amsterdam Agricultural Futures Exchange.     

Predicting autonomous and controlled motivation to transfer training

In spite of a broad consensus on the importance of motivation for the transfer of learning from training to the job in work organizations, studies investigating motivation to transfer are limited. This study combines the self‐determination theory, the expectancy theory and the theory of planned behaviour to provide a theoretical framework for investigating attitudes towards training content, relatedness and instructional satisfaction as predictors of two dimensions of transfer motivation: autonomous motivation to transfer and controlled motivation to transfer. A total of 444 subjects, trained in 23 occupational health and safety training courses, completed multi‐item questionnaires immediately following training. Structural equation modelling procedures indicate that controlled motivation to transfer was affected by attitudes towards training content and that autonomous motivation to transfer was affected by attitudes, relatedness and instructional satisfaction. The results are discussed in terms of theoretical and practical implications for training effectiveness associated with the interplay of motivation and transfer in professional training.     

Entrepreneurial intentions in the third age: the impact of perceived age norms

This article investigates the impact of perceived age norms on the formation of entrepreneurial intentions in the third age. Age norms refer to those social norms that determine whether establishing and running a business are considered appropriate behavior for a mature individual. An empirical analysis of Finnish individuals finds that norms perceived as permissive of enterprising activity in the third age exert a significant positive influence on entrepreneurial intentions in this segment, even when controlling for the general level of entrepreneurship in the municipalities. This influence is partially mediated by whether the individual has a positive attitude toward entrepreneurship, by how the individual perceives their own ability to start and run a business, by the extent of support from their family and friends they perceive and by the importance of that support to them. Thus, if policy aims to increase enterprising activity in the third-age segment, the portfolio of instruments should include measures that address people’s general awareness of third-age entrepreneurship as a viable, positive and attractive late-career option.     

Supporter networks and network growth: a contingency model of organizational emergence

Despite the belief that networks are essential to entrepreneurial success, very few studies consider the role of networks in the founding of new organizations. In response, we test the direct and interactive effects of the characteristics of nascent entrepreneurs’ supporter networks and network growth on organizational emergence. We find that (1) the governance and content of the supporter network, along with network growth, are important in predicting organizational emergence, and (2) the structure and content of the supporter network may inform the need for network growth. We conclude by discussing the implications of our findings for academics and practitioners.     

Legitimating behaviors and firm emergence: a resource dependence perspective

This study makes an attempt to understand some of the reasons why some nascent firms make the transition to new operational firms (a process called “firm emergence”) while others do not. Because of liabilities-of-newness, nascent firms face the daunting task of acquiring legitimacy from their immediate audience in order to emerge as new operational firm. This study claims and finds empirical evidence that through certain legitimating behaviors nascent firms can acquire legitimacy from their immediate audience and thus succeed in becoming new operational firms. The study will put forward more general propositions for future testing, and will draw implications for practitioners and entrepreneurship scholars.

Exploring the evolution of supporter networks in the creation of new organizations

Networks are important to entrepreneurial success. However, most research in this area to date has merely addressed the what; namely, what types of networks enable success. We seek to extend this stream of research by answering the how and the why. In so doing, we elaborate on how entrepreneurs can develop their networks, arguing that in order to create new organizations, nascent entrepreneurs must acquire resources from an increasingly diverse set of relatively stronger and weaker ties throughout the emergence phase. We then hypothesize why this evolutionary path is effective across the various dimensions of tie strength. Analyzing data from the Panel Study of Entrepreneurial Dynamics I (PSED I) with multilevel random coefficient growth curve modeling, we find strong support for our hypotheses. We conclude by discussing the implications of our findings for both academics and practitioners.