Agency Theory Issues in the Food Processing Industry

Boland, Michael A.; Golden, Bill B.; Tsoodle, Leah J.

doi:10.1017/s1074070800023890

Cited by 13 publications

(12 citation statements)

References 27 publications

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“…Based on their analysis, only one of the cooperatives in their sample suffered from increased agency costs due to increased solvency. Schumacher & Boland (2004), Boland, Golden, & Tsoodle (2008), and Dorsey & Boland (2009) have found that solvency is a significant variable in explaining the financial performance of firms in the four segments of the food economy (e.g., processing, wholesale grocery, retail supermarket, and restaurant). Thus, solvency is a logical variable to use when explaining profitability.…”

Section: Literature Reviewmentioning

confidence: 99%

Factors Determining Profitability of the Insurance Industry of Bangladesh

Ullah

Faisal

Zuhra

2016

IFB

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Insurance is a form of risk management, used to hedge against the risk of a contingent loss. It involves the transfer of the risk of potential loss from one entity to another, in exchange for a risk premium. Insurance sector plays an important role in service based economy of both developed and developing markets. The purpose of this research is to analyze the determinants that serve as significant predictors of non-life insurance firms' profitability in Bangladesh. It analyzes panel data of eight different insurance companies-selected using convenience sampling method from the years

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Section: Literature Reviewmentioning

confidence: 99%

Factors Determining Profitability of the Insurance Industry of Bangladesh

Ullah

Faisal

Zuhra

2016

IFB

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“…For example, Anderson and Reeb () and Boland et al . () show that the percentage of firms in the US food industry with a significant share of family‐ownership is particularly high. Similarly, in the EU food economy in most industries a significant number of family owned firms can be found (Wijnands et al ., , Palpacuer and Tozanli, ).…”

Section: Us and Eu Food Processing Industry Population And Samplementioning

confidence: 99%

“…This seems to confirm the results of Anderson and Reeb () and Boland et al . () where it is found that family ownership is both prevalent and that a ‘greater percentage of equity held by insiders such as management and family members leads to greater performance’. We therefore infer that our samples adequately reflect the presence of family‐ ownership and the respective impact on profitability.…”

Section: Us and Eu Food Processing Industry Population And Samplementioning

confidence: 99%

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What Drives Firm Profitability? A Comparison of the US and EU Food Processing Industry

Gschwandtner¹,

Hirsch

2017

The Manchester School

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Non-technical summaryThe present project analyses what drives profitability in the food sector and compares the results with the manufacturing industry in general but also between the European Union and the United States.One of the main findings is that competition is stronger and profitability is lower within the food sector as compared with the manufacturing sector in general. This is mainly attributable to a high market saturation and to the fierce competition between the big retail companies. While the competition profits the consumer, it puts strong bargaining pressure on the producers. Therefore, one of the main drivers of profitability and profit persistence within the food sector is firm size. Larger producers seem to be in a better bargaining position against the retail sector and this seems to be both the case in the EU and in the US.A determinant where the food sector seems to differ between the two regions is firm's growth. While the impact of firm's growth on profitability is positive in the US, it is insignificant in the EU. This may be because while growing firms have to take into consideration higher costs and this may decrease profitability.And this may explain yet another difference between the determinants of profitability in the food sector in the US and in the EU. While the impact of (long-term) debt is positive in the US, it is negative in the EU. By having easier access to debt, US firms are presumably able to better counteract this potentially negative effect of growth. Long-term debt can enable firms to make the necessary investments that help to ensure competitiveness in times of crisis. In the EU firms indebted in the long run seem to find it more difficult to cope with risk.The results have not only purely descriptive value but can also be useful when designing policies aimed at supporting food sector firms or the food sector as a whole. This is important as today firms are facing economic circumstances characterized by reduced entry barriers and possibilities to operate in previously hardly accessible foreign markets. Those developments are a consequence of intensified globalization represented by trade agreements such as the NAFTA or the formation of a single market for goods and services within the EU. However, these deregulations of borders and international trade have led to a significant intensification of competition among firms across many sectors. Pressure on the margins and competitiveness ...

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“…A brief overview of each theory is presented below. Boland, Golden, and Tsoodle (2008) describe various applications of each theory in the management and agricultural economics literature.…”

Section: Reasons Why Firms Integratementioning

confidence: 99%

The Impact of Integration Strategies on Food Business Firm Value

Dorsey¹,

Boland²

2009

J. Agric. Appl. Econ.

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The objective of this study is to analyze whether a discount or premium exists for coordination strategies in food processing, wholesale grocery, retail supermarkets, and restaurants. Significant premiums are found for food processor and restaurant vertical integration or diversification strategies. Significant discounts are found for food wholesaler and retail supermarket integration or diversification strategies. Food processors are found to be integrating toward retail supermarkets during this time period.

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Agency Theory Issues in the Food Processing Industry

Cited by 13 publications

References 27 publications

Factors Determining Profitability of the Insurance Industry of Bangladesh

Factors Determining Profitability of the Insurance Industry of Bangladesh

What Drives Firm Profitability? A Comparison of the US and EU Food Processing Industry

The Impact of Integration Strategies on Food Business Firm Value

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