New Evidence on the Value of Public Information in Commodity Markets

OFOR Working Paper Number 94-04

Posted: 29 Oct 2000

See all articles by Philip Garcia

Philip Garcia

University of Illinois at Urbana-Champaign - Department of Agricultural and Consumer Economics

Scott H. Irwin

University of Illinois at Urbana-Champaign

Raymond M. Leuthold

University of Illinois @ Urbana-Champaign

Li Yang

Western Michigan University

Abstract

The informational value of USDA corn and soybean production forecasts is investigated for the period 1971-1992. Three tests of informational content are considered: i) a relative forecast accuracy test, ii) a price reaction test, and iii) a willingness-to-pay test. Overall, the results suggest USDA corn and soybean forecasts provide valuable information to commodity markets. This value, however, does appear to have declined, especially since the mid-1980s. This is consistent with large declines in the cost of information due to technological improvements in computers, communications equipment, remote-sensing satellites, etc.

JEL Classification: 14

Suggested Citation

Garcia, Philip and Irwin, Scott and Leuthold, Raymond M. and Yang, Li, New Evidence on the Value of Public Information in Commodity Markets. OFOR Working Paper Number 94-04, Available at SSRN: https://ssrn.com/abstract=5500

Philip Garcia

University of Illinois at Urbana-Champaign - Department of Agricultural and Consumer Economics ( email )

1301 W. Gregory Drive
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Scott Irwin

University of Illinois at Urbana-Champaign ( email )

344 Mumford Hall
1301 W. Gregory Dr.
Urbana, IL 61801
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HOME PAGE: http://https://scotthirwin.com/

Raymond M. Leuthold (Contact Author)

University of Illinois @ Urbana-Champaign ( email )

1301 W. Gregory Drive
326 Mumford Hall
Urbana, IL 61801
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217-333-1810 (Phone)
217-333-5538 (Fax)

Li Yang

Western Michigan University

Dept. of Computer Science
Kalamazoo, MI 49008
United States

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