Agricultural Firms Research Articles

The Sixth Sector Industrialization of Agriculture and the Relay Shipping of Vegetables in Japan

This paper aims to extract lesson from the experiences of Japan for escaping from the middle income trap which many countries in Asia and Africa confront. This paper will review in detail the efforts to increase the income levels of rural and agricultural firms by establishing a value chain under an almost zero growth economy in the 2000s in Japan. After referring to the condition of Japan agriculture and the framework of structural reform of agricultural policy of Japan, the core action schemes of the Sixth Industrialization and Relay Shipping are focused on. The mechanisms of relay shipping of vegetables and the institutions for facilitating the scheme are reviewed in detail. It is revealed that institutional capacity for greater inter-sector and government coordination are essential for implementing the schemes to establish effective and efficient value chain. These are institutional reform and capacity building efforts in Japan. Experiences in Japan reveal that various executing agencies with good governance are required to establish the mechanism of effective resource mobilization and implement reform of value chain. There have been no detail studies on implementing such reform for establishing sustainable value chain in countries where escaping middle income trap is needed. This study should be useful lesson for countries confronting the middle income trap.

Positive effect of village debt on land transfer: Evidence from county-level panel data of village finance in Zhejiang Province.

The purpose of this paper is to examine the impact of village debt on land transfer. Based on the county-level panel data of village finance and land transfer in 90 counties and 4 economic development zones of Zhejiang Province from 2013 to 2017, this paper carried out multivariate statistical analysis and set a fixed effect model to control the endogenous influence of region and time. It found that village debt as a pressure may encourage village committees to promote rural land transfer, and then especially promote land flows into agricultural firms; as a mechanism, the burden of village organization’s transactional debt (historical debt and administrative debt) is the key to promoting the rural land flow to agricultural enterprises; through further analysis, it is found that the village committee seeks "win-win" opportunities by intervening in land circulation to ensure the rights and interests of farmers and to obtain village benefits from them. This paper finds that this kind of push effect has the threshold, the debt will play a significant role in promoting when the debt rate is between 4.65% and 7.9%. In addition, there is regional heterogeneity in the contribution of debt, which exists only in plain, non-coastal and high-dependence areas. The results of this paper verify the view that "community mechanism and market mechanism are embedded and supported each other in acquaintance society" in the theory of community governance. In practice, it provides a realistic basis for policy makers to implement the policy of encouraging farmland circulation and properly deal with the problem of village debt.

The performance and corporate risk-taking of firms: evidence from Malaysian agricultural firms

PurposeThis study explores the effects of the performance and corporate risk-taking behaviour of agricultural firms. Despite its importance in mitigating climate change, the agricultural sector also faces global competition, market liberalisation, rapid technological advances and the starter of stricter quality and safety procedures, all of which require firms to take greater risks.Design/methodology/approachThis study explores this relationship by applying generalised least square (GLS), random effect methodologies (REM) and generalised method of moments (GMM).FindingsThe findings report a favourable relationship between firm performance and corporate risk-taking using a sample of firms from an emerging market.Research limitations/implicationsThe effects of these results for management practice and recommendations for further research were examined.Originality/valueWhile this empirical study used a sample focused on a single industry, most previous studies focused on multiple industries. The originality of this study is its analysis of how firm performance affects corporate risk-taking in the Malaysian agriculture sector.

Corporate Governance, Financial Characteristics, Macroeconomic Factors and Financial Performance of Agricultural Firms Listed at the Nairobi Securities Exchange, Kenya

This study sought to examine the relationships between corporate governance, financial characteristics, macroeconomic factors and financial performance of agricultural firms listed at the Nairobi Securities Exchange, Kenya. The specific objectives were to establish the effect of corporate governance on financial performance; to determine the intervening effect of financial characteristics on corporate governance and financial performance; to establish the moderating effect of macroeconomic factors on corporate governance and financial performance of listed agricultural firms; and to establish the joint effect of corporate governance, financial characteristics, macroeconomic factors and financial performance of listed agricultural firms in Kenya. This study is anchored on agency theory, transaction cost theory; political theory and cash conversion cycle theory. The study used census approach and a target population of seven agricultural firms listed at the Nairobi Securities Exchange between 2002 and 2016 was incorporated. The study used panel data. Corporate governance, financial characteristics and financial performance data was extracted from annual reports of the individuals firms while macroeconomic factors data was extracted from Central Bank of Kenya and Kenya National Bureau of Statistics economic reports. The study employed longitudinal descriptive research design. Descriptive and panel data regression analysis were conducted. Corporate governance had significant effect on financial performance of listed agricultural firms in Kenya; the intervening effect of financial characteristics on the relationship between corporate governance and financial performance was not determined; the moderating effect of macroeconomic factors on the relationship between corporate governance and financial performance was confirmed; and the joint relationship between corporate governance, financial characteristics and macroeconomic factors on financial performance was established. The study recommended a review of corporate governance principles and directors to comply with corporate governance structure and practices to enhance financial performance of firms.

IMPROVEMENT OF INFORMATION QUALITY ON STATE ASSISTANCE IN ACCOUNTING AND REPORTING OF AGRICULTURAL COMPANIES

Agriculture is of great importance for the Russian economy and is one of its most stable and fast growing sectors. The farming experience in the European agro developed countries confirms the need for active state intervention explained by the special features of the sector. Our country allocates huge resources to support of agriculture. Russia’s mechanisms of agricultural subsidies are improved on a constant basis meaning that the accounting and financial reporting systems as information tools of management should be adapted to the functional changes in modern agricultural companies, including improvement of subsidy mechanisms. Our research assesses accounting for state aid and formation of accounting reporting indicators taking agricultural firms of the Voronezh region as an example. It also develops the directions of further activities. The results will help improve the information basis for managerial decisions when distributing and analyzing effectiveness of state aid in the agrarian firms.

Should we use antitrust policies on big agriculture?

AbstractThis paper discusses the benefits and costs of antitrust intervention in agriculture. We argue that over the long run, fixed costs have increased and marginal costs have decreased, which has created a tension between lower food prices and having a large number of farms. As opposed to policies of most industries, agricultural policy seems to place more importance upon producer surplus instead of consumer surplus, which runs directly counter to the goals of antitrust laws. While protecting small farms may potentially be an appropriate use of other policy instruments (such as the Farm Bill), using antitrust laws to break up large agricultural firms and/or protect small farms may result in higher food prices, which is regressive and exacerbates inequality. Furthermore, the application of antitrust law for the purpose of raising food prices and producer surplus is antithetical to its historic purpose.

Sustainable Feasibility of the Environmental-Friendly Policies on Agriculture and Its Related Sectors in India

In terms of economic development and feeding the world’s populations, the importance of the agricultural sector is well known. However, agriculture and its related sectors are also known for contributing more than one-quarter of the world’s GHG emissions. To address this issue, we evaluate the performance of agriculture and its related firms in India from 2013 to 2019 with its environmental efficiency under the paradigm shift promoted by the National Agroforestry Policy in 2014. To evaluate the feasibility of this paradigm shift in agricultural policy, the non-radial slack-based measure (SBM) is utilized in the first stage, and Tobit regressions are used to assess the determinants of efficiency (or sources of inefficiency) measures at the second stage. The results from non-radial SBM show that Indian agricultural firms (foreign direct investment, private, and public) show huge potential with 32.2% on average to enhance their performance if they move toward the frontier of the production possibility curve. This suggests that Indian policymakers should regulate much stronger regulations for firms, especially for the use of agricultural inputs such as energy (fertilizers), with performance-oriented financial measures for sustainable agriculture. To determine the strategic variables for these firms to enhance their performance, Tobit regressions showed that fertilizers use (−3.350%) appears to have the highest negative impact on environmental efficiency. On the other hand, credit access (2.710%) has the highest positive impact on environmental efficiency, implying that policymakers should provide subsidies to firms in the form of soft loans (or credit access) for the purchase of high-quality fertilizers and to adopt energy-saving equipment/technology to minimize the use of chemical fertilizers in India.

Relationship between efficiency and profitability: The case of Czech swine sector

Aim of study: To examine the link between economic efficiency and profitability of firms belonging to the swine sector.Area of study: This study is devoted to the Czech swine sector that forms the traditional and essential part of agriculture in the Czech Republic.Material and methods: Data from the Albertina CZ Gold Edition database for the period 2008-2017 were used. To evaluate the economic efficiency, the data envelopment analysis models are applied. Return on equity, return on assets and return on sales are used to measure profitability. To assess the relationship between economic efficiency and profitability, the Pearson correlation coefficient is used.Main results: The results demonstrate that there is no clear link between the economic efficiency of firms and their profitability in this industry. The correlation between all three profitability ratios and efficiency score were predominantly positive but not statistically significant in many cases. The economies of scale and scope and the construction of profitability indicators could be the main factors explaining the fact that companies achieving higher efficiency are not also more profitable.Research highlights: The study provides material useful to owners, managers, and customers of Czech agriculture firms. It identifies the relatively high efficiency of firms measured relatively to the best Czech company. In the European context, however, the efficiency of Czech firms belonging to the swine sector is low. It also reveals that the profitability of the firms is not a representative proxy for economic efficiency.

Gender differences in business structures created in the areas of production and transport in 2018

Purpose. In recent years, there has been an increase in the role of entrepreneurship in modern national economies. The article is devoted to the actual problem of assessing entrepreneurial activity in four sectors: agricultural production, mining, manufacturing and transport. At the same time, gender differences in entrepreneurial activity by country are considered. Objectives. The author examines the specific weights of entrepreneurs whose firms are specialized in the four above-mentioned types of economic activity, taking into account the existing gender differences, in the total number of women and men entrepreneurs. The study was based on the principles and concepts of differentiation of entrepreneurship by type of economic activity. Methods and data. The research process included five stages. The results of surveys of entrepreneurs conducted in 59 countries during the implementation of the Global Entrepreneurship Monitoring Project were used as initial information in the study. In the course of the study, economic and mathematical modeling was carried out using the density functions of the normal distribution. At the same time, the theoretical basis for the development of such functions for describing probabilistic processes was taken into account. Results. The study solved the problems of evaluating the values of six indicators that characterize firms in agriculture, mining, manufacturing and transport according to data for 2018. In addition, the ratios characterizing the prevalence of specific weights for men and women in each of the countries under consideration were determined. A comparative analysis was carried out, which allowed us to identify the countries that were characterized by the maximum and minimum values of the indicators. The comparison of the values of indicators for Russia and foreign countries is carried out. Conclusions. The study showed that the proportion of women and men who created businesses in the agricultural, mining, manufacturing and transport industries was 17% and 25%, respectively. In 2018, there were gender differences in the specialization of entrepreneurs. The conclusions presented in the article have a significant novelty and originality. They can be used in the activities of public administration bodies, as well as in further research.

Transforming enterprise networks: building a wellness human being ecosystem

The transformation of enterprises' network connections in the epoch of changes is revealed in the article, the formation of Human Welfare EcoSystem as well as the provision of innovative economic growth based on the work of industrial cluster and internal connections between enterprises is substantiated. The authors reveal the relationship between the innovative growth of the economy and the functioning of clusters in the ecosystem. The article presents the conclusion that the ecosystem is a set of interrelated and interdependent components of the environment, agglomerations, industrial and agricultural firms connected by the Internet things, which aims to organize a prosperous, healthy and happy society.

Land Rezoning and Structural Transformation in Rural India: Evidence from the Industrial Areas Program

Abstract Zoning laws that restrict rural land to agricultural production pose an important institutional barrier to industrial development. We study the effects of the Industrial Areas (IA) program in Karnataka, India, which rezoned agricultural land for industrial use, but without the economic incentives common with other place-based policies. We find that the program caused a large increase in firm creation and employment in villages overlapping the IAs. Moreover, the surrounding areas experienced spillover effects, with workers shifting from agricultural to non-agricultural employment, and entrepreneurs establishing numerous small-scale service sector and agricultural firms.

Курганцева миша (Mus spicilegus) на Західному Поділлі: експансія на лівобережжі Дністра

New findings of the mound-building mouse on the left bank of the Dniester in the interfluve of its tributaries—the Dzhuryn and the Nichlava (Chortkiv Raion, Ternopil Oblast)—are described. The presence of Mus spicilegus was established based on findings of food stocks common for this species in the form of mounds, which are easy to detect in the field and which can be clearly diagnosed. Both single mounds and their clusters were taken into account. The specifics of biotopic distribution, formation of food reserves, and the role in trophic chains of this species under conditions of the studied region are indicated. The mound-building mouse is one of the few rodent species that maintain a high abundance under conditions of intensive agriculture, which involves mechanical tillage several times a year and a significant level of chemical use. The distribution of the studied species is influenced primarily by two factors: the level of agricultural techniques in agricultural production (arable farming and crop care, quality of harvesting) and the distance from uncultivated areas. The mound-building mouse usually inhabits agricultural lands with a low level of agriculture (minimal chemicalization and mechanical tillage). These are lands allocated for private gardening or farming. Such lands have increased weeds and crop losses during harvesting, which creates a rich food base. After harvesting, such lands usually do not undergo long-term tillage. Results show that the settlement of arable lands comes from natural or other uncultivated areas, where the nuclei of populations are concentrated. In autumn, under the above favourable conditions, population growth is observed in adjacent cultivated lands, where winter food reserves are formed in the form of characteristic mounds. On large-area crops of monocultures cultivated by large agricultural firms, mounds are usually absent. The level of agro-technical pressure on the same area varies from year to year. This causes temporary instability in the appearance of mounds. They disappear where anthropogenic impact has re-emerged significantly and re-appear where there has been a weakening. The role of the mound-building mouse in trophic chains and in maintaining regional biodiversity is shown.

Capital Adequacy A Moderating Effect of Asset Growth on Performance of Nigerian Agricultural Firms

This study examines capital adequacy and the moderating impact of asset growth on the performance of firms in the agricultural sector. 4 listed agricultural firms were examined over a period of 10 years and data were extracted from their financial statements which were analyzed through a STATA 13 tool of analysis. Regression, correlation matrix and descriptive methods of analysis were employed to present and analyze results. Other post estimation tests like skewness and kurtosis test, Variance Inflation Factor test, specification test, heteroskedasticity tests and hausman test to select between fixed effect and random effect regression model were conducted to ensure robustness of results. The fixed effect stochastic longitudinal regression analysis model was adopted as guided by the hausman test. From the findings posited by the study, liquidity structure, liquidity structure moderated by asset growth and the combined effect of firm size moderated by asset growth were found to be significantly impacting on return on asset of firms at 1% level of significance. Firm size was found not to have any significant impact on return on assets. It was therefore recommended that the management should ensure considerable excess of current assets over current liabilities at all times so that there will always be positive liquidity structure; management should ensure consistent and prudent capital acquisition to ensure larger firm size; management should ensure steady asset growth by asset revaluation and new acquisition over time; the regulatory authority in the agricultural sector should establish a firm size benchmark below which no firm should operate.

The Impact of Intellectual Capital on the Profitability of Russian Agricultural Firms

Economic efficiency is a function of two types of resources: those that are presented in financial statements and those that are not. Non-balance sheet resources are referred as to intellectual capital (IC). The purpose of the paper is to investigate the relationship between IC, its components and the level of financial profitability. To conduct the analysis, we used the system generalized method of moments for a broad sample of Russian firms that operate in the agribusiness industry. We employed two financial approaches to IC estimation. The first one is the Value Added Intellectual Coefficient (VAIC). The second one is own-created approach that is supposed to respond the criticism regarding VAIC. Comparison between VAIC and own-created approach to IC estimation revealed that the latter is more appropriate due to its advantages. Our approach unlike VAIC allows measuring both efficiency ratios and the stocks of IC. The results showed that the efficiency of structural capital usage and the stock of human capital have the biggest impact on the profitability level of the agricultural businesses among employed measures of IC.

Do Environmental Compliances Reduce Agricultural Profitability? An Inference from Indonesia

This research seeks to find the effect of environmental compliances on profitability in the agricultural business sector. This research is quantitative by testing the nexus between environmental compliances (environmental cost and reputational incentive) and agricultural profitability. The sample of this study identified agricultural public firms in Indonesia including five sub-sectors consisting of farming, fisheries, livestock, plantation, and forestry. Financial statements and annual reports in terms of the environment were utilized in this research. Final samples were 12 public agricultural companies. The research model was analysed using the regression with common, fixed and random effect models and were checked the robustness using Generalized Method of Moment (GMM). The result of this research found no effects on the nexus between environmental cost and profitability. It indicates that the environmental cost spent by agricultural firms doesn’t reduce the profitability. The emerging effect can be found on reputational incentive leading the increase into the extent of agricultural profitability both return on assets and return on equity.

Determinants of Failures of Local Agricultural Firms in Cameroon: The Case of Soderim, Ugicaes and Ugirilcopam in the Mbo Plain (Cameroon)

Despite significant financial and technical resources mobilized by the State through financial institutions, local development has not followed the investment curve and the peasantry is still drowned in underdevelopment. In the 1960s, the State of Cameroon launched the five-year development plan where, one of the major components is the development of structuring projects keeping in mind the construction of agro-industrial complexes to serve as models for small farms placed under their supervision. Therefore, specialized development companies (SODES) such as SODERIM, UGICAES and UGIRILCOPAM were created and received 1,200,000,000FCFA, 20,000,000FCFA and 177,000,000FCFA respectively and 5,200,000FCFA grants each per year. However, it is difficult nowadays to appreciate the input of this funding into local development. This study aims at evaluating the contribution of agricultural project financing to local development and its sustainability in the Mbo plain. We used empirical observation based on semi-directive interviews with the managers of SODERIM, UGICAES and UGIRILCOPAM firms (former employees), and questionnaire administration to peasants and agricultural extension agents as well as the exploitation of secondary data collected from the Sub-Divisional Delegation of Agriculture, registers of these firms, and field observation. Results show that SODERIM, UGICAES and UGIRILCOPAM did not foster the development of the Mbo plain and all went bankrupt when funding stopped since they were unable to self-finance. The determinants of these local agricultural firms failure were both external and internal. The infrastructural, political and socio-economic aspects have remained dormant. Thus, financing has not stimulated a new peasant dynamic in an autonomous framework.

Pengungkapan Corporate Sosial Responsibility, Media Exposure dan Profitabilitas

This research examined the impact of corporate social responsibility (CSR) disclosure on firms’ profitability moderated by media exposure. The samples selected were 15 agricultural firms listed on Indonesian Stock Exchange for the period of 2016-2018. The data were analyzed using Moderated Regression Analysis (MRA). The result showed that CSR disclosure do not affect ROA, but media exposure had a direct effect to ROA. Based on the legitimacy theory, firms conduct CSR to align with societal values and norms. To earn legitimacy from the society, CSR needs to be communicated to channels that are easily accessed by the people, so the benefits of CSR can be realized into profits. Based on the research results, companies are expected to use their websites or social media more often to communicate their CSR activities. 
 Keywords: Corporate Sosial Responsibility; Disclosure; Profitability; Media Exposure.

Firm characteristics and Biological Asset Disclosure on Agricultural Firms

Agriculture firms are facing challenges on applying the Statement of Financial Accounting Standards (PSAK) 69 which regulates the recognition, measurement, disclosure, presentation and reporting biological assets because of the unique trait of biological assets. This research aims to decide the factors that influence the biological asset disclosure by testing the effect of leverage, profitability, liquidity, firm’s growth, biological assets’ intensity, firm size, type of auditor, and listing status. The samples used in this research are the agriculture firms listed on the Indonesia Stock Exchange (IDX) between 2016 and 2018. The data are collected from the auditor financial statement. This research uses a quantitative method with multiple linear regression analysis. The conclusion is that the intensity of biological asset influences the biological asset disclosure, while leverage, profitability, liquidity, firm’s growth, firm size, type of auditor, and listing status do not influence the biological asset disclosure. This research contributes as literature for academics, gives knowledge about agriculture firm’s problems for the standard compiler, and improving the agriculture firms’ obediency in disclosing their biological asset following the PSAK 69

Bank Credit, Trade Credit and Growth of Listed Agricultural Firms in Vietnam

Bank Credit, Trade Credit and Growth of Listed Agricultural Firms in Vietnam

European benchmarking of determinants of profitability for companies with accrual accounting in the agricultural sector

In this study, differences in common measures of profitability, such as return on sales, return on capital employed and return on equity, are analysed in agricultural firms with accrual accounting in 10 European countries. The resulting differences in profitability are broken down using an additive decomposition method, which addresses the quantified impact of several affecting factors. This approach is based on a ratio system, which follows the principles of the DuPont identity. According to the general intention of benchmarking, the leading country within the sample for each measure of profitability provides the relevant reference point, representing best practice. This approach provides insight into the specific comparative strengths and weaknesses of the agribusinesses in the countries within the sample and indicates useful starting points for effective improvements. In addition to the value-creating operations, this involves, in particular, labour productivity, the efficient use of fixed assets and the degree of debt financing.