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Economies of Scale and Scope for Agricultural Supply and Marketing Cooperatives

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  • Ted C. Schroeder

Abstract

This study estimates scale and scope economies for a sample of multiproduct farm supply and grain marketing local cooperatives. A bootstrapping regression technique is used to estimate confidence intervals for the scale and scope elasticities. Strong support is found for firm-wide economies of scale. In addition, product-specific economies of scale are present for grain, petroleum, feed, and other merchandise sales, and to some extent fertilizer, but not for chemical sales. Scope economies are present for all six products.

Suggested Citation

  • Ted C. Schroeder, 1992. "Economies of Scale and Scope for Agricultural Supply and Marketing Cooperatives," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 14(1), pages 93-103.
    • Handle: RePEc:oup:revage:v:14:y:1992:i:1:p:93-103.
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    File URL: http://hdl.handle.net/10.2307/1349610
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    1. Ofori, Eric Makafui & Yeager, Elizabeth & Briggeman, Brian, "undated". "Agricultural Cooperative mergers and efficiency gains: An ex-ante analysis," 2020 Annual Meeting, February 1-4, 2020, Louisville, Kentucky 302323, Southern Agricultural Economics Association.
    2. Ariyaratne, Chatura B. & Featherstone, Allen M. & Langemeier, Michael R. & Barton, David G., 2000. "Measuring X-Efficiency And Scale Efficiency For A Sample Of Agricultural Cooperatives," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 29(2), pages 1-10, October.
    3. Jasper Grashuis, 2019. "Spatial Competition in the Iowa Corn Market: Informing the Pricing Behavior of Corporate and Cooperative Grain Merchants," Sustainability, MDPI, vol. 11(4), pages 1-13, February.
    4. James, L. & Glynn, T., 2017. "Reexamining the Question: Are Imported Beef and Domestic Beef Complements or Substitutes?," 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama 252720, Southern Agricultural Economics Association.
    5. Roosen, Jutta, 1999. "A Regional Econometric Model of U.S. Apple Supply and Demand," ISU General Staff Papers 199904010800001318, Iowa State University, Department of Economics.
    6. James Wangu & Ellen Mangnus & A.C.M. (Guus) van Westen, 2020. "Limitations of Inclusive Agribusiness in Contributing to Food and Nutrition Security in a Smallholder Community. A Case of Mango Initiative in Makueni County, Kenya," Sustainability, MDPI, vol. 12(14), pages 1-23, July.
    7. Kozo Harimaya & Koichi Kagitani, 2022. "Efficiency, and economies of scale and scope in Japanese agricultural cooperatives," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 11(1), pages 1-19, December.
    8. Pokharel, Krishna & Archer, David W. & Featherstone, Allen M., 2018. "The Impact of Size and Specialization on the Financial Performance of Agricultural Cooperatives," 2018 Annual Meeting, August 5-7, Washington, D.C. 274109, Agricultural and Applied Economics Association.
    9. Yapo Genevier N’guessan & Allen Featherstone & Oluwarotimi Odeh & Sreedhar Upendram, 2017. "Choice of the empirical definition of zero in the translog multiproduct cost functional form," Applied Economics Letters, Taylor & Francis Journals, vol. 24(15), pages 1112-1120, September.
    10. David G. Barton & Ted C. Schroeder & Allen M. Featherstone, 1993. "Evaluating the feasibility of local cooperative consolidations: A case study," Agribusiness, John Wiley & Sons, Ltd., vol. 9(3), pages 281-294.
    11. Theo Benos & Nikos Kalogeras & Martin Wetzels & Ko De Ruyter & Joost M. E. Pennings, 2018. "Harnessing a ‘Currency Matrix’ for Performance Measurement in Cooperatives: A Multi-Phased Study," Sustainability, MDPI, vol. 10(12), pages 1-38, December.
    12. Ohe, Yasuo & Kurihara, Shinichi, 2013. "Evaluating the complementary relationship between local brand farm products and rural tourism: Evidence from Japan," Tourism Management, Elsevier, vol. 35(C), pages 278-283.
    13. Valentinov, Vladislav & Iliopoulos, Constantine, 2013. "Economic theories of nonprofits and agricultural cooperatives compared: New perspectives for nonprofit scholars," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 42(1), pages 109-126.
    14. Yu, L. & Huang, W., 2018. "Non-economic societal impact or economic revenue? Performance and efficiency analysis of farmer cooperatives in China," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277512, International Association of Agricultural Economists.
    15. Pokharel, Krishna P & Featherstone, Allen M, 2016. "A Nonparametric Approach to Estimate Multiproduct and Product-specific Scale and Scope Economies for Agricultural Cooperatives," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 236182, Agricultural and Applied Economics Association.
    16. Ariyaratne, Chatura B. & Featherstone, Allen M. & Langemeier, Michael R. & Barton, David G., 1997. "An Analysis of Efficiency of Midwestern Agricultural Cooperatives," 1997 Annual Meeting, July 13-16, 1997, Reno\ Sparks, Nevada 35763, Western Agricultural Economics Association.
    17. Mafoua, Edouard & Hossain, Ferdaus, 2001. "Scope And Scale Economies For Multi-Product Farms: Firm-Level Panel Data Analysis," 2001 Annual meeting, August 5-8, Chicago, IL 20627, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    18. Loris Strappazzon & Arthur Ha & Mark Eigenraam & Charlotte Duke & Gary Stoneham, 2003. "Efficiency of alternative property right allocations when farmers produce multiple environmental goods under the condition of economies of scope," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 47(1), pages 1-27, March.
    19. Shumway, C. Richard, 1995. "Recent Duality Contributions In Production Economics," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 20(1), pages 1-17, July.
    20. Mafoua, Edouard, 2002. "Economies Of Scope And Scale Of Multi-Product U.S. Cash Grain Farms: A Flexible Fixed-Cost Quadratic (Ffcq) Model Analysis," 2002 Annual meeting, July 28-31, Long Beach, CA 19734, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

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