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Predicting Farm Tractor Values through Alternative Depreciation Methods
Author(s) -
Dumler Troy J.,
Burton Robert O.,
Kastens Terry L.
Publication year - 2003
Publication title -
applied economic perspectives and policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.4
H-Index - 49
eISSN - 2040-5804
pISSN - 2040-5790
DOI - 10.1111/1467-9353.00152
Subject(s) - tractor , depreciation (economics) , economics , econometrics , earnings before interest, taxes, depreciation, and amortization , agricultural economics , business , microeconomics , finance , engineering , earnings , profit (economics) , financial capital , automotive engineering , capital formation
This study compares a variety of farm tractor depreciation methods to determine which most accurately estimates farm tractor values. These alternative depreciation methods consider different factors for estimating remaining value and vary in difficulty of use. Pairwise comparisons of mean absolute percentage error and forecast accuracy regression models were used to evaluate the accuracy of the depreciation methods, which depend on age, intensity of use, and manufacturer. Based on the results of this study, the Cross and Perry method was generally the most accurate.