Ph.D. Dissertation, University of Missouri, Columbia, MO, EUA.<\/p>\n
ABSTRACT:\u00a0This dissertation investigates the determinants that influence a firm\u2018s decision to<\/p>\n
use external private equity in agriculture. Scholars have recognized the benefits of<\/p>\n
external equity finance for agricultural firms (i.e., capital derived from a source other<\/p>\n
than retained earnings and existing owners) and the use of external equity in agriculture<\/p>\n
has increased since 1990. This is important because this source of capital allows farms to<\/p>\n
exploit business opportunity, particularly for companies that pose risks that discourage<\/p>\n
debt capital, and because private equity has fostered entrepreneurial activity. However,<\/p>\n
the literature addressing this phenomenon is limited. The asset specificity approach<\/p>\n
(Williamson 1988) offers insightful contributions to understand the choice of financial<\/p>\n
mechanisms. This approach brings additional insights and complements agency\u2014the<\/p>\n
dominant perspective in finance. The analysis focuses on the differential redeployability<\/p>\n
of the assets involved in the production of different agricultural product. I construct an<\/p>\n
international dataset of agricultural companies that receive external private equity finance<\/p>\n
to test hypotheses about the determinants of using external equity finance. Results show<\/p>\n
that the attributes of the assets involved in agriculture are important factors to explain<\/p>\n
financing choices in agriculture. This research contributes to the understanding of the role<\/p>\n
of asset specificity to explain financing decisions and to the identification of what types<\/p>\n
of asset specificity play an important role in agriculture.<\/p>\n