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This article examines the relationship between economic value added (EVA) and the stock market performance of 17 publicly traded companies in the Canadian food processing sector. The research is motivated by the increased popularity of EVA in corporate finance and by the claims that high EVA causes incremental gains in share price values. Using1996 annual reports to compute EVA, and daily stock prices for 1994 through 1998, we attempt to correlate EVA with a variety of measures including accounting return on assets (ROA), return on equity (ROE), share price, the Capital Asset Pricing Model (CAPM) returns and risk, and others. Results find little support for the conjecture that high-EVA firms lead to higher shareholder value, however, because the management logic that has popularized EVA is so logical and fundamental to common practices in corporate finance that we resist dismissing EVA as a valued paradigm. Rather, we suggest that market volatility and other factors mask the short-run increments to shareholder wealth from EVA-implemented strategies. [EconLit citations: G30, Q13.]

Risk balancing refers to the balancing of business risk (BR) and financial risk (FR) by firms through their investment and borrowing decisions. Assuming the concept holds, a decrease in income variability (BR) prompts the firm to incur greater debt levels thereby increasing FR. Reducing (BR), which continues to be the central objective of Canadian agricultural policy through programs such as Canadian Agricultural Income Stabilization Program (CAIS)/AgriStability, may lead farmers to take on more FR than they would take otherwise, which, in turn, increases the risk of equity loss. However, it is not known whether Canadian business risk management (BRM) programs offset BR as intended, and whether any potential reduction leads to increased FR (risk balancing) and possibly higher levels of overall risk for individual farm operations. This paper represents the first attempt to shed light on whether Canadian BRM programs fail to reduce farm risk as a result of farmers' risk balancing behavior using a longitudinal farm-level data set from Ontario. Results are mixed: (1) BRM payments reduce BR for beef farms but not for field crops farms (though the latter result may be due to the lack of data on Crop Insurance payments); (2) risk balancing holds particularly for the larger farms, and (3) BRM programs overall have no significant effect on the likelihood of increased debt use for either sector, on average; however, participation in CAIS/AgriStability increases the probability that farms take on more debt than they would take otherwise for both sectors. Further analysis is needed to determine whether BRM programs increase the probability of default for farms. L'équilibre des risques fait référenceà l'équilibre des risques de l'entreprise et des risques financiers que visent les entreprises dans leurs décisions d'investissement et d'emprunt.À supposer que le concept soit valable, une diminution de la variabilité du revenu (risque de l'entreprise) inciterait l'entreprisè a hausser son niveau d'endettement, ce qui ferait augmenter le risque financier. La diminution des risques de l'entreprise, qui constitue le principal objectif de la politique agricole canadienne et de divers programmes, tels que le Programme canadien de stabilisation du revenu agricole (PCSRA) et * Senior authorship is shared by the first two authors. 595 596 CANADIAN JOURNAL OF AGRICULTURAL ECONOMICSle programme Agri-stabilité, pourrait amener les agriculteursà courir davantage de risques financiers ce qui, par conséquent, augmenterait le risque de perte de capitaux propres. Toutefois, on ne sait pas si les programmes canadiens de gestion des risques de l'entreprise (GRE) contrebalancent ou non comme prévu les risques de l'entreprise ni si une diminution potentielle des risques de l'entreprise entraîne ou non une hausse du risque financier (équilibre des risques) et possiblement une hausse des niveaux de risques dans le cas des exploitations agricoles individuelles. Le présent article se veut une première tentative visantà déterminer,à l'aide d'un ensembl...

The Beer Game is one of the most popular simulations used to introduce students to the challenges of managing supply chains. While the basic simulation serves as a useful introduction to the problems, it does not take the next step of helping students or managers plan to surmount those problems and manage an efficient supply chain. This paper suggests a strategy for taking that next step, helping students move toward solutions of supply chain problems. The strategy builds supply chain teaching modules or an executive development program around modified Beer Game simulations. This paper also provides the tools for accomplishing both an introductory and a more advanced simulation. These simulation‐based programs have proved highly effective and popular in undergraduate, graduate and executive development programs.

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