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Optimal Market Pools for Agricultural Cooperatives

Author

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  • Steven T. Buccola
  • Abdelbagi Subaei

Abstract

Most agricultural marketing cooperatives distribute members' net revenues on a pool basis. The present paper outlines various pool options and provides a framework for identifying privately and collectively optimal pooling rules. Individual members' pool choices are found to vary according to farm enterprise and risk aversion level. A collectively optimal rule depends generally on risk aversion and on the method used to aggregate individuals' expressed preferences. In the instance examined here, however, the collective optimum is somewhat insensitive to assumed risk aversion.

Suggested Citation

  • Steven T. Buccola & Abdelbagi Subaei, 1985. "Optimal Market Pools for Agricultural Cooperatives," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 67(1), pages 70-80.
  • Handle: RePEc:oup:ajagec:v:67:y:1985:i:1:p:70-80.
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    File URL: http://hdl.handle.net/10.2307/1240825
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    Cited by:

    1. Lerman, Zvi & Parliament, Claudia, 1990. "Estimating The Profitability Of Pool Cooperatives," Staff Papers 13788, University of Minnesota, Department of Applied Economics.
    2. Constance L. Falk & Daniel S. Tilley, 1990. "Packing facility management: Stochastic dominance analysis of cost allocation and revenue distribution rules," Agribusiness, John Wiley & Sons, Ltd., vol. 6(4), pages 355-369.
    3. Sporleder, Thomas L. & Goldsmith, Peter D., 1990. "The Risk Mitigation Aspects of Agricultural Cooperatives," Cooperatives: Their Importance in the Future Food and Agricultural System - FAMC 1990 Conference 265910, Food and Agricultural Marketing Consortium (FAMC).
    4. Nikos Kalogeras & Joost M.E. Pennings & Ivo. A. van der Lans & Philip Garcia & Gert van Dijk, 2009. "Understanding heterogeneous preferences of cooperative members," Agribusiness, John Wiley & Sons, Ltd., vol. 25(1), pages 90-111.
    5. Julia HÖHLER & Rainer KÜHL, 2018. "Dimensions Of Member Heterogeneity In Cooperatives And Their Impact On Organization – A Literature Review," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 89(4), pages 697-712, December.
    6. Kalogeras, Nikos & Pennings, Joost M.E., 2013. "Marketing Cooperatives' Equity Sources: An Empirical Study," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150701, Agricultural and Applied Economics Association.

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