DISCRETE AND CONTINUOUS TIME MODELS FOR FARM CREDIT MIGRATION ANALYSIS

This paper introduces two continuous time models, i.e. time homogenous and non-homogenous Markov chain models, for analyzing farm credit migration as alternatives to the traditional discrete time model cohort method. Results illustrate that the two continuous time models provide more detailed, accurate and reliable estimates of farm credit migration rates than the discrete time model. Metric comparisons among the three transition matrices show that the imposition of the potentially unrealistic assumption of time homogeneity still produces more accurate estimates of farm credit migration rates, although the equally reliable figures under the non-homogenous time model seem more plausible given the greater relevance and applicability of the latter model to farm business conditions.


Issue Date:
2004
Publication Type:
Conference Paper/ Presentation
DOI and Other Identifiers:
Record Identifier:
https://ageconsearch.umn.edu/record/20062
PURL Identifier:
http://purl.umn.edu/20062
Total Pages:
23
Series Statement:
Selected Paper




 Record created 2017-04-01, last modified 2019-08-26

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)