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Marketing Co‐operatives: An Incomplete Contracting Perspective

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  • George W. J. Hendrikse
  • Cees P. Veerman

Abstract

Marketing co‐operatives (MCs) are analysed from an incomplete contracting perspective. The requirement of the domination of control by the members of an MC is a threat to the survival of an MC in markets where the level of asset specificity at the processing stage of production is increasing. However, an MC may remain an efficient governance structure when the increasing level of asset specificity is compensated for by a sufficient increase in the extent of product differentiation.

Suggested Citation

  • George W. J. Hendrikse & Cees P. Veerman, 2001. "Marketing Co‐operatives: An Incomplete Contracting Perspective," Journal of Agricultural Economics, Wiley Blackwell, vol. 52(1), pages 53-64, January.
    • Handle: RePEc:bla:jageco:v:52:y:2001:i:1:p:53-64
    DOI: 10.1111/j.1477-9552.2001.tb00909.x
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    References listed on IDEAS

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    1. Imre Ferto & Gabor G. Szabo, 2002. "Vertical Co-ordanitaion in Transition Agriculture: a Hungarian Cooperative Case Study," CERS-IE WORKING PAPERS 0210, Institute of Economics, Centre for Economic and Regional Studies.
    2. Iselborn, M. & Jungbluth, L. & Hanf, J.H., 2015. "Probleme des Qualitätsmanagements bei Winzergenossenschaften," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 50, March.
    3. Schamel, Guenter H. & Santos-Arteaga, Francisco J., 2015. "Firm Organizational and Payoff Imbalances: An Aggrievement Model with Cooperatives and Private Firms," 2015 Conference, August 9-14, 2015, Milan, Italy 212274, International Association of Agricultural Economists.
    4. Hu, Y. & Huang, Z. & Hendrikse, G.W.J. & Xu, X., 2005. "Organization and Strategy of Farmer Specialized Cooperatives in China," ERIM Report Series Research in Management ERS-2005-059-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    5. Liang, Qiao & Hendrikse, George W. J. & Huang, Zuhui, 2010. "Value added and governance structure: Evidence from the pear industry in China's Zhejiang province," IAMO Forum 2010: Institutions in Transition – Challenges for New Modes of Governance 52708, Leibniz Institute of Agricultural Development in Central and Eastern Europe (IAMO).
    6. George Hendrikse, 2011. "Pooling, Access, and Countervailing Power in Channel Governance," Management Science, INFORMS, vol. 57(9), pages 1692-1702, March.
    7. Szabo, Gabor G., 2005. ""Co-Operative Identity" - A Theoretical Concept for Dynamic Analysis of Practical Co-Operation: The Dutch Case," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24453, European Association of Agricultural Economists.
    8. Iiro Jussila & Sanjay Goel & Pasi Tuominen, 2012. "Governance of Co-operative Organizations: A Social Exchange Perspective," Business and Management Research, Business and Management Research, Sciedu Press, vol. 1(2), pages 14-25, June.
    9. Hendrikse, G.W.J., 2011. "Pooling, Access, and Countervailing Power in Channel Governance," ERIM Report Series Research in Management ERS-2011-009-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    10. Kalogeras, Nikos & van der Lans, Ivo A.C.M. & Pennings, Joost M.E. & van Dijk, Gert, 2004. "Members' Preferences For Cooperative Structures: An Experimental Conjoint Study," 2004 Annual meeting, August 1-4, Denver, CO 20292, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    11. Ragasa, Catherine & Lambrecht, Isabel & Kufoalor, Doreen S., 2018. "Limitations of Contract Farming as a Pro-poor Strategy: The Case of Maize Outgrower Schemes in Upper West Ghana," World Development, Elsevier, vol. 102(C), pages 30-56.
    12. Hellberg-Bahr, A. & Steffen, N. & Spiller, A., 2012. "Unternehmensstrategie Defizite in Genossenschaftsmolkereien: Eine mitgliederbasierte Fallstudie," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 47, March.
    13. Jasper Grashuis, 2018. "Joint ownership by farmers and investors in the agri-food industry: an exploratory study of the limited cooperative association," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 6(1), pages 1-14, December.
    14. Hendrikse, G.W.J., 2005. "Boards in Agricultural Cooperatives: Competence, Authority, and Incentives," ERIM Report Series Research in Management ERS-2005-042-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    15. Dan Yang & Zimin Liu, 2012. "Study on Chinese farmer cooperative economy organization and agricultural specialization," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 58(3), pages 135-146.
    16. Feng, L. & Hendrikse, G.W.J., 2011. "Chain Interdependencies, Measurement Problems, and Efficient Governance Structure: Cooperatives versus Publicly Listed Firms," ERIM Report Series Research in Management ERS-2011-001-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    17. Bontems, Philippe & Fulton, Murray, 2009. "Organizational structure, redistribution and the endogeneity of cost: Cooperatives, investor-owned firms and the cost of procurement," Journal of Economic Behavior & Organization, Elsevier, vol. 72(1), pages 322-343, October.
    18. Grashuis, Jasper & Cook, Michael, 2016. "Capital, Ownership, and Governance: Analyzing the Structure of U.S. Farmer Cooperatives," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235677, Agricultural and Applied Economics Association.
    19. Gabor G. Szabo & Krisztina Bardos, 2005. "Vertical Coordination by Contracts in Agribusiness - An Empirical Research in the Hungarian Dairy Sector," CERS-IE WORKING PAPERS 0515, Institute of Economics, Centre for Economic and Regional Studies.
    20. Hendrikse, G.W.J. & van Oijen, A.A.C.J., 2002. "Diversification and Corporate Governance," ERIM Report Series Research in Management ERS-2002-48-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    21. JIA, Xiangping & HUANG, Jikun & XU, Zhigang, 2012. "Marketing of farmer professional cooperatives in the wave of transformed agrofood market in China," China Economic Review, Elsevier, vol. 23(3), pages 665-674.
    22. Szabo, Gabor G., 2007. "“Co-operative identity”: A theoretical concept for economic analysis of practical co-operation dynamics," Studies in Agricultural Economics, Research Institute for Agricultural Economics, vol. 105, pages 1-18, January.
    23. Hellberg-Bahr, Anneke & Steffen, Nina & Spiller, Achim, 2011. "Unternehmensstrategische Defizite in Genossenschaftsmolkereien: Eine mitgliederbasierte Fallstudie," 51st Annual Conference, Halle, Germany, September 28-30, 2011 114496, German Association of Agricultural Economists (GEWISOLA).
    24. Hendrikse, G.W.J. & Veerman, C.P., 2003. "On The Future of Co-operatives," ERIM Report Series Research in Management ERS-2003-007-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.

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