Holbrook Working

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Holbrook Working (1895 – October 5, 1985), a professor of economics and statistics at Stanford University’s Food Research Institute, is known for his contributions on hedging, the theory of futures prices – which anticipated the efficient market hypothesis, an early theory of market maker behavior,[1] and the theory of storage (including the Working curve which plots the difference between short term and long term grain futures prices against current inventory).[2][3]

He disagreed with Keynes’s backwardation theory of futures prices, which argued that short hedgers (farmers) drive down futures prices because of their demand for price insurance. Working argued that there could be hedgers on both sides of the market and that hedging was essentially not a risk reduction technique, but "speculation in the basis" which allows informed traders and commodity dealers to profit from their knowledge of future changes in the difference between futures and spot prices.

A native of Fort Collins, Colorado, Working received his Ph.D. in Agricultural Economics from the University of Wisconsin–Madison in 1921. Before joining the Food Research Institute in 1925, he taught at Cornell University and the University of Minnesota. His younger brother Elmer Working made a major contribution on the identification problem for demand curves in econometrics, with which Holbrook Working was also involved.

He was a founding member of the Econometric Society and was elected a Fellow of the American Agricultural Economics Association, the American Statistical Association, and the American Association for the Advancement of Science.[4] In 1981 he was awarded the Wilks Memorial Award by the American Statistical Association.

Notable papers[edit]

  • "The Statistical Determination of Demand Curves", 1925, Quarterly Journal of Economics
  • "Review of Mitchell", 1928, Journal of the American Statistical Association
  • "A Random Difference Series for Use in the Analysis of Time Series", 1934, Journal of the American Statistical Association
  • "Differential Price Behavior as a Subject for Commodity Price Analysis", 1935, Econometrica
  • "Futures Trading and Hedging", 1953, American Economic Review
  • "Hedging Reconsidered", 1953, Journal of Farm Economics
  • "New Concepts Concerning Futures Markets and Prices", 1962, American Economic Review
  • "Tests of a Theory Concerning Floor Trading on Commodity Exchanges", 1967, Food Research Institute Studies


  1. ^ Price Effects of Scalping and Daytrading Proceedings of the Symposium on Futures Markets and the Public Interest, Chicago, 1954, accessed 4/24/07.
  2. ^ The Working Brothers History of Economic Thought, accessed 4/24/07
  3. ^ Working, H. 1933, "Price Relations between July and September Wheat Futures at Chicago Since 1885", Wheat Studies of the Food Research Institute
  4. ^ Stanford Historical Society accessed 4/24/07.