Determinants of Contractual Arrangements in Agricultural Credit Transactions (Determinantes dos Arranjos Contratuais nas Transações de Crédito Agrícola) (Portuguese)

Revista de Administração da USP, Vol. 45, No. 3, pp. 209-220, 2010

12 Pages Posted: 26 Nov 2010

See all articles by Luciana Florêncio Almeida

Luciana Florêncio Almeida

ESPM SP Business School

Decio Zylbersztajn

University of São Paulo (USP) - Department of Administration

Peter G. Klein

Baylor University - Hankamer School of Business; Norwegian School of Economics (NHH) - Department of Strategy and Management; Ludwig von Mises Institute

Date Written: June 23, 2009

Abstract

Because of a reduction in the supply of subsidized agricultural credit in Brazil, the economic agents in the agro-industrial systems organized themselves to tie in credit and their buying and selling transactions with farmers. Different types of agreements appeared, characterized by different finance structures. In this study, the authors aimed at verifying the causal relation between the type of financing used by soy producers in Brazil and their possible determinants. Two arrangements were chosen for analysis: getting bank loans and getting loans tied to transactions with agro-industrial chain agents. The explanatory variables used were property size, guarantees provided and reputation, measured in terms of how long the relationship had existed for. As foreseen in the theory, results showed that property size is one of the determinants of credit transactions between farmers and agro-industrial chain agents. However, the relation with government banks and the guarantees did not turn out to be relevant elements for the analysis of the determinants in the choice of contractual arrangements for soy financing with agents of the agro-industrial system.

Note: Downloadable document is in Portuguese.

Keywords: Contracts, Rural Credit, Agribusiness.

Suggested Citation

Almeida, Luciana Florencio and Zylbersztajn, Decio and Klein, Peter G., Determinants of Contractual Arrangements in Agricultural Credit Transactions (Determinantes dos Arranjos Contratuais nas Transações de Crédito Agrícola) (Portuguese) (June 23, 2009). Revista de Administração da USP, Vol. 45, No. 3, pp. 209-220, 2010, Available at SSRN: https://ssrn.com/abstract=1715522

Luciana Florencio Almeida

ESPM SP Business School ( email )

Rua Alvaro Alvim,123
Sao Paulo, Sao Paulo
Brazil

Decio Zylbersztajn (Contact Author)

University of São Paulo (USP) - Department of Administration ( email )

Av. Prof. Luciano Gualberto
908 - Predio 1 Sala C14
Sao Paulo 05508-900
Brazil
55-11-3032-5966 (Phone)
55-11-3032-5966 (Fax)

Peter G. Klein

Baylor University - Hankamer School of Business ( email )

Waco, TX 76798
United States
254-710-4903 (Phone)

Norwegian School of Economics (NHH) - Department of Strategy and Management ( email )

Breiviksveien 40
N-5045 Bergen
Norway

Ludwig von Mises Institute ( email )

Auburn, AL
United States

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