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Rent Sharing in Multi-Site Hog Production

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  • Brian P. Cozzarin
  • Randall E. Westgren
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    Abstract

    A firm-level model of three-site hog production is used compare a franchise organizational structure to a three-firm alliance. The results of the simulations imply that the franchise system is better equipped to mitigate underproduction in the nursery and finishing units, the nursery and finishing units lose relatively more profit than they otherwise would in an alliance. The pig-space guatantee does little to offset the financial risk for the nursery and finishing units when underproduction occurs upstream (breeding, gestation, and farrowing unit). Copyright 2000, Oxford University Press.

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    File URL: http://hdl.handle.net/10.1111/0002-9092.00003
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    Bibliographic Info

    Article provided by Agricultural and Applied Economics Association in its journal American Journal of Agricultural Economics.

    Volume (Year): 82 (2000)
    Issue (Month): 1 ()
    Pages: 25-37

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    Handle: RePEc:oup:ajagec:v:82:y:2000:i:1:p:25-37

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    Cited by:
    1. Franken, Jason R.V. & Pennings, Joost M.E. & Garcia, Philip, 2008. "Do Transaction Costs and Risk Preferences Influence Marketing Arrangements in the Illinois Hog Industry?," 2008 Conference, April 21-22, 2008, St. Louis, Missouri 37599, NCCC-134 Conference on Applied Commodity Price Analysis, Forecasting, and Market Risk Management.
    2. Franken, Jason R.V. & Pennings, Joost M.E., 2005. "Changing Agricultural Marketing Channel Structures: Interdependences & Risk Preferences," 2005 Annual meeting, July 24-27, Providence, RI 19414, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. Cozzarin, Brian P. & Westgren, Randall E., 2000. "Rent Sharing Mechanisms In Production Alliances," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association (IAMA), vol. 3(03).
    4. Franken, Jason R.V. & Parcell, Joseph L. & Patterson, David J. & Smith, Michael F. & Poock, Scott, . "Cow-Calf Producer Interest in Retained Ownership," Journal of Agribusiness, Agricultural Economics Association of Georgia.
    5. Herath, Deepananda P.B. & Weersink, Alfons, 2003. "Vertical Coordination Changes In The Sri Lankan Tea Industry:Transaction, Management, And Production Costs," 2003 Annual meeting, July 27-30, Montreal, Canada 21941, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

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