An analysis of lenders' influence on agricultural producers' risk management decisions
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Agricultural lenders have a stake in and are in a position to influence their borrowers' management decisions. This study employs logistic statistical models to estimate lenders' influence on crop producers' decisions regarding use of three alternative risk management practices: federal multiple-peril crop insurance, crop hail and fire insurance, and forward contracting. Results suggest lenders can exert significant influence on these decisions but that poor communication between lenders and borrowers likely reduces this influence. -from Authors