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A Study of the Economic Functions of the Maine Potato Futures Market

Published online by Cambridge University Press:  10 May 2017

Jeff Sooy  and
Ben Branch
Jeff Sooy
Affiliation:
Department of General Business and Finance, University of Massachusetts
Ben Branch
Affiliation:
Department of General Business and Finance, University of Massachusetts
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Abstract

In an update and extension of prior work this study found that the potato futures markets continued to provide very unreliable forecasts of subsequent spot prices. On the other hand and contrary to some past studies an extensive study here failed to turn up any convincing evidence of a cobweb pricing relationship. Moreover the increasing volatility of potato futures prices in the more recent time period raises questions regarding their value as hedging vehicles. Finally it is argued that the market's efficiency might be improved by expanding the current Maine potato contract to permit delivery of round white potatoes grown outside Maine.

Type
Research Article
Information
Journal of the Northeastern Agricultural Economics Council , Volume 9 , Issue 1 , April 1980 , pp. 51 - 61
Copyright
Copyright © Northeastern Agricultural and Resource Economics Association 

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Footnotes

We would like to thank Bill Tomek, Ann Peck and several unnamed referees for their helpful comments.

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