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On the emergence of new growers' associations: self-selection versus countervailing power

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  • George Hendrikse
  • Jos Bijman
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    Abstract

    Increasing differentiation on the supply side of agricultural and horticultural markets has resulted in the emergence of new growers' associations (GAs). These GAs face a trade-off between self-selection and countervailing power, which is analysed with an incomplete contracting model. Heterogeneous GAs frustrate high-quality growers as a result of the policy of applying the equality principle, but they are strong in terms of countervailing power of the growers collectively. The opposite holds for homogeneous GAs. Homogeneous GAs prevail when the benefits of product differentiation are large, or when low-quality producers can be driven out of the market. An efficiency rationale for EU Regulation (EC) No. 2200-96 is formulated. Copyright 2002, Oxford University Press.

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    Bibliographic Info

    Article provided by Foundation for the European Review of Agricultural Economics in its journal European Review of Agricultural Economics.

    Volume (Year): 29 (2002)
    Issue (Month): 2 (June)
    Pages: 255-269

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    Handle: RePEc:oup:erevae:v:29:y:2002:i:2:p:255-269

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    Cited by:
    1. Bogetoft, Peter & Olesen, Henrik Ballebye, 2003. "Influence Costs In Heterogeneous Cooperatives: A Formal Model Of Sales Distortion," 2003 Annual meeting, July 27-30, Montreal, Canada 22190, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    2. repec:hal:wpaper:halshs-00354960 is not listed on IDEAS
    3. Maze, Armelle, 2006. "Multilateral reputation mechanisms and contract law in agriculture : complement or substitutes," 2006 Annual meeting, July 23-26, Long Beach, CA 21285, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    4. Paul Diederen & Hans van Meijl & Arjan Wolters, 2003. "Modernisation in agriculture: what makes a farmer adopt an innovation?," International Journal of Agricultural Resources, Governance and Ecology, Inderscience Enterprises Ltd, vol. 2(3/4), pages 328-342.

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