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Allocation of Decision Rights in Fruit and Vegetable Contracts in China

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  • Yamei Hu
  • George Hendrikse

Abstract

This paper empirically examines the determinants of the allocation of decision rights in the context of fruit and vegetable contracting. A multiple case study is used to investigate twelve fruit and vegetable contracts in order to test five hypotheses regarding the decision rights allocated to the farmer growers and to the downstream agricultural firms. The main conclusion is that under contract farming, many decision rights are shifted from farmers to firms. Quality, reputation, monopsony-oligopsony power and specific investments by firms positively influence the number of decision rights allocated to agribusiness firms under contract farming, whereas specific investments by farmers have no effect on the allocation of decision rights.

Suggested Citation

  • Yamei Hu & George Hendrikse, 2009. "Allocation of Decision Rights in Fruit and Vegetable Contracts in China," International Studies of Management & Organization, Taylor & Francis Journals, vol. 39(4), pages 8-30, January.
    • Handle: RePEc:taf:mimoxx:v:39:y:2009:i:4:p:8-30
    DOI: 10.2753/IMO0020-8825390401
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    Cited by:

    1. Nada Mumdžiev & Josef Windsperger, 2011. "The Structure of Decision Rights in Franchising Networks: A Property Rights Perspective," Entrepreneurship Theory and Practice, , vol. 35(3), pages 449-465, May.
    2. Jia, Xiangping & Hu, Yamei & Hendrikse, George & Huanga, Jikun, 2010. "Centralized versus individual: Governance of farmer professional cooperatives in China," IAMO Forum 2010: Institutions in Transition – Challenges for New Modes of Governance 52699, Leibniz Institute of Agricultural Development in Central and Eastern Europe (IAMO).
    3. George Hendrikse & Patrick Hippmann & Josef Windsperger, 2015. "Trust, transaction costs and contractual incompleteness in franchising," Small Business Economics, Springer, vol. 44(4), pages 867-888, April.
    4. Magali Aubert & Zouhair Bouhsina & Jean Marie Codron & Sylvain Rousset, 2013. "Pesticide safety risk, food chain organization, and the adoption of sustainable farming practices. The case of Moroccan early tomatoes," Post-Print hal-02806083, HAL.
    5. Manyise, Timothy & Dentoni, Domenico, 2021. "Value chain partnerships and farmer entrepreneurship as balancing ecosystem services: Implications for agri-food systems resilience," Ecosystem Services, Elsevier, vol. 49(C).
    6. Jean Marie Codron & Zouhair Bouhsina & Laure Bonnaud, 2013. "Collective action and allocation of decision rights in pesticide safety risk management: the case of tomato producer organizations in France," Post-Print hal-02748504, HAL.

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