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Competing Screening Rules

Author

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  • Hendrikse, George W.J.
  • Hu, Yamei

Abstract

Various studies show that agricultural cooperatives behave differently than their investor-owned counterparts. One explanation may be that the internal decision making process differs in these two governance structures. A model is developed to explore how endogenous screening rules affect efficient organizational choices and industrial structures. It is shown that screening level choice may outweigh architecture choice and that screening rules are strategic substitutes. Conditions are derived under which cooperatives are efficient organizational forms. It is also shown that competition may increase the attractiveness of investor-owned firms and circumstances are determined in which cooperatives and investor owned firms coexist in equilibrium.

Suggested Citation

  • Hendrikse, George W.J. & Hu, Yamei, 2005. "Competing Screening Rules," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24522, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae05:24522
    DOI: 10.22004/ag.econ.24522
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    Keywords

    Agribusiness;

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