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One Cow, One Vote?

Author

Listed:
  • Svend Albæk
  • Christian Schultz

Abstract

We study investment decisions in a farmers' cooperative. Farmers sell their products through the cooperative. Before production takes place the cooperative has to decide on an investment. We study whether voting on investment leads to efficient investment decisions. The answer depends on how the number of votes and the cost of the investment are distributed among the farmers. It is shown that in a variety of settings, there is no reason to suppose that voting rules favoring large farmers —“one cow, one vote” rules — are more efficient than simple majority rule.

Suggested Citation

  • Svend Albæk & Christian Schultz, 1997. "One Cow, One Vote?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 99(4), pages 597-615, December.
    • Handle: RePEc:bla:scandj:v:99:y:1997:i:4:p:597-615
    DOI: 10.1111/1467-9442.00083
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    Cited by:

    1. Olimov, Jafar, 2014. "Cooperatives and the Risk Aversion of Farmers," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170833, Agricultural and Applied Economics Association.
    2. Birger Wernerfelt, 2007. "Delegation, Committees, and Managers," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 16(1), pages 35-51, March.
    3. Maxime Agbo & Damien Rousselière & Julien Salanié, 2013. "A theory of agricultural marketing cooperatives with direct selling," Post-Print halshs-00949726, HAL.
    4. 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).
    5. Hart, Oliver & Moore, John, 1998. "Cooperatives vs. outside ownership," LSE Research Online Documents on Economics 19360, London School of Economics and Political Science, LSE Library.
    6. Roma, Paolo & Perrone, Giovanni, 2016. "Cooperation among competitors: A comparison of cost-sharing mechanisms," International Journal of Production Economics, Elsevier, vol. 180(C), pages 172-182.
    7. Bogetoft, Peter, 2021. "How upstream cooperatives limit downstream holdups," Journal of Economic Behavior & Organization, Elsevier, vol. 181(C), pages 156-168.
    8. Ma, Meilin & Zhu, Heng, 2014. "Decision Making Among Heterogeneous Members: A Study on Economic Efficiency under the Centralized Structure of Chinese Farmer Professional Cooperatives," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 168366, Agricultural and Applied Economics Association.
    9. Kyriakos Kyriakopoulos & Matthew Meulenberg & Jerker Nilsson, 2004. "The impact of cooperative structure and firm culture on market orientation and performance," Agribusiness, John Wiley & Sons, Ltd., vol. 20(4), pages 379-396.
    10. Agbo, Maxime & Rousselière, Damien & Salanié, Julien, 2015. "Agricultural marketing cooperatives with direct selling: A cooperative–non-cooperative game," Journal of Economic Behavior & Organization, Elsevier, vol. 109(C), pages 56-71.
    11. 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.
    12. repec:hal:journl:halshs-01098762 is not listed on IDEAS

    More about this item

    JEL classification:

    • L29 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Other
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

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