A hybrid approach to explore the risk dependency structure among agribusiness firms

Lei, Z., Wu, K.-J., Cui, L. and Lim, M. (2018) A hybrid approach to explore the risk dependency structure among agribusiness firms. Sustainability, 10(2), 533. (doi: 10.3390/su10020533)

Abstract

Although the risk management of agricultural firms is important, studies on the extreme risk dependence among agribusiness firms are minimal due to the diversity and complexity of the risks faced by agricultural firms. In this study, we developed a hybrid approach to analyse and uncover the potential risk dependence among agricultural firms. We examined thirty-two agricultural companies to study their dependence structure for risk losses. Three primary findings emerged. First, risk dependence is strong with an average value of 0.96. Second, the dependence structure is hierarchical and includes two network communities. Third, some key agricultural firms were identified in the dependence structure. These key firms are critical for the transmission of negative impacts across agricultural firms. Correspondingly, we suggest measures and strategies (such as improving the level of technological innovation and joint risk resistance capability) to reduce the impact of risk dependence.

• Item Type: Articles
• Additional Information: This study was supported by the National Natural Science Foundation of China (71701029, 71533001), Fundamental Research Funds for the Central Universities (DUT16RC (3) 038) and (DUT16RC (4) 72), Liaoning Academy of Social Sciences Fund (L17BGL019), and the scholarship from China Scholarship Council (CSC) (201506060084).
• Status: Published
• Refereed: Yes
• Glasgow Author(s) Enlighten ID: Lim, Professor Ming
• Authors: Lei, Z., Wu, K.-J., Cui, L., and Lim, M.
• College/School: College of Social Sciences > Adam Smith Business School > Management
• Journal Name: Sustainability
• Publisher: MDPI
• ISSN: 2071-1050
• ISSN (Online): 2071-1050
• Published Online: 16 February 2018
• Copyright Holders: Copyright © 2018 by the authors
• First Published: First published in Sustainability 10(2):533
• Publisher Policy: Reproduced under a Creative Commons licence