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Why are cooperatives important in agriculture? An organizational economics perspective
Abstract
This paper develops an organizational economics explanation for agricultural cooperatives by building upon the transaction cost theory of family farms. According to this theory, the importance of family farms in Western agriculture is a result of the low feasibility of hierarchical organization in agricultural production due to supervision and monitoring difficulties. This paper argues that the transaction cost-economizing effect of family farms has a price in the form of their limited ability to realize economies of scale and to develop market power comparable to that of their up- and downstream trading partners. The role of agricultural cooperatives is shown to help overcome these limitations in order to take advantage of the transaction-cost economizing properties of family farms. This explanation of agricultural cooperatives is sector-specific in the sense that it traces the benefits of cooperative organization back to the organizational attributes of agricultural production.
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Cites
Coase, R. H. (1937) · Economica · doi:10.1111/j.1468-0335.1937.tb00002.x · Cited by 23,972
Comparative Economic Organization: The Analysis of Discrete Structural Alternatives
Williamson, O. E. (1991) · Administrative Science Quarterly · doi:10.2307/2393356 · Cited by 7,151
Cited by
Linking Smallholders to Markets: Determinants and Impacts of Farmer Collective Action in Kenya
Fischer, E., & Qaim, M. (2012) · World Development · doi:10.1016/j.worlddev.2011.11.018 · Cited by 836
Empirical evaluation of agricultural sustainability using composite indicators
Gómez-Limón, J. A., & Sanchez-Fernandez, G. (2010) · Ecological Economics · doi:10.1016/j.ecolecon.2009.11.027 · Cited by 424
Yildiz, Ö., Rommel, J., Debor, S., Holstenkamp, L., Mey, F., Müller, J. R., Radtke, J., & Rognli, J. (2015) · Energy Research & Social Science · doi:10.1016/j.erss.2014.12.001 · Cited by 366
POST‐SOCIALIST FARMERS’ COOPERATIVES IN CENTRAL AND EASTERN EUROPE
HAGEDORN, K. (2014) · Annals of Public and Cooperative Economics · doi:10.1111/apce.12051 · Cited by 59
Papaioannou, G., Mohammed, A.-M., Despoudi, S., Saridakis, G., & Papadopoulos, T. (2020) · International Journal of Information Management · doi:10.1016/j.ijinfomgt.2020.102077 · Cited by 38
Metadata
- Authors
- VALENTINOV, V.
- Venue
- Journal of Institutional Economics
- Publisher
- Cambridge University Press (CUP)
- Published
- 2007-04
- Volume
- 3
- Issue
- 1
- Pages
- 55-69
- ISSN
- 1744-1374 (ISSN-L)
- 1744-1382
- OpenAlex
- W2131113875
- Cited by
- 320
- References
- 2
- FWCI
- 14.34
- Type
- journal article
- Language
- en
- Open access
- closed
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- VALENTINOV, V. (2007). Why are cooperatives important in agriculture? An organizational economics perspective. Journal of Institutional Economics. https://doi.org/10.1017/s1744137406000555
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Bibliographic data: Semantic Scholar, OpenAlex, Crossref.
Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
Semantic Scholar’s data is described in: Kinney, R., et al. (2023). The Semantic Scholar Open Data Platform. arXiv:2301.10140.
