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Sustainability 2018, 10(2), 533; https://doi.org/10.3390/su10020533

A Hybrid Approach to Explore the Risk Dependency Structure among Agribusiness Firms

1
Faculty of Management and Economics, Dalian University of Technology, Dalian 116024, China
2
School of Business, Dalian University of Technology, Panjin 124221, China
3
China Business Executives Academy, Dalian 116086, China
4
College of Mechanical Engineering, Chongqing University, Chongqing 400044, China
5
Centre for Business in Society, Coventry University, Coventry CV1 5FB, UK
*
Author to whom correspondence should be addressed.
Received: 12 January 2018 / Revised: 13 February 2018 / Accepted: 14 February 2018 / Published: 16 February 2018
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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. View Full-Text
Keywords: risk losses; dependence structure; copula; minimum spanning trees; agribusiness risk losses; dependence structure; copula; minimum spanning trees; agribusiness
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Lei, Z.; Wu, K.-J.; Cui, L.; Lim, M.K. A Hybrid Approach to Explore the Risk Dependency Structure among Agribusiness Firms. Sustainability 2018, 10, 533.

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