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 markets hypothesis, an early theory of market maker behavior, 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).
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 in 1921. Before joining the Food Research Institute in 1925, he taught at Cornell University and the University of Minnesota.
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.
