Chicken Coop Foreclosures?? Time for a Bailout...

An interesting little story appeared on the front page of the Wall Street Journal today (2/12/09) relating to chicken farmers losing their chicken houses to foreclosures. According to the story, the problems started with the bankruptcy of Pilgrim's Pride who has canceled many contracts with growers in an attempt to cut cost.

These are, of course, real economic hardships. But, it also points to the impacts of something called asset specificity, a theory which suggests that when you are heavily invested in an asset (in this case, a chicken coop) that cannot be effectively used for any other purpose, the owner of that asset is subject to considerable economic risk. Apparently so...