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Multilateral reputation mechanisms and contract law in agriculture : complement or substitutes

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Author Info
Maze, Armelle
Abstract

The enforcement of contracts is necessary for efficient exchange in economic activities. The predominance in agriculture of informal contracts leads in many countries to the implementation of specific legal rules for contract law. This article emphasises the complementarities between public and private ordering when contracts are informal. We analyse the role of private contract-enforcement institution (CEI) as a support for multilateral reputation mechanisms. Our case study is focusing on interprofessional organisations, which are usually analysed as cartels having a negative impact on welfare. We demonstrate that under specific conditions, they can improve contract enforcement and thus efficiency.

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Paper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 2006 Annual meeting, July 23-26, Long Beach, CA with number 21285.

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Date of creation: 2006
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Handle: RePEc:ags:aaea06:21285

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Keywords: Agricultural Finance;

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  5. Klein, Benjamin, 1996. "Why Hold-Ups Occur: The Self-Enforcing Range of Contractual Relationships," Economic Inquiry, Oxford University Press, vol. 34(3), pages 444-63, July.
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  7. Greif, Avner, 1989. "Reputation and Coalitions in Medieval Trade: Evidence on the Maghribi Traders," The Journal of Economic History, Cambridge University Press, vol. 49(04), pages 857-882, December. [Downloadable!]
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  9. George Hendrikse & Jos Bijman, 2002. "On the emergence of new growers' associations: self-selection versus countervailing power," European Review of Agricultural Economics, Oxford University Press for the Foundation for the European Review of Agricultural Economics, vol. 29(2), pages 255-269, June.
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  15. Alston, Lee J. & Libecap, Gary D. & Mueller, Bernardo, 1999. "A model of rural conflict: violence and land reform policy in Brazil," Environment and Development Economics, Cambridge University Press, vol. 4(02), pages 135-160, May. [Downloadable!]
  16. Chalfant, James A & Sexton, Richard J, 2002. " Marketing Orders, Grading Errors, and Price Discrimination," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 84(1), pages 53-66, February. [Downloadable!] (restricted)
  17. Ronald N. Johnson & Gary D. Libecap, 2003. "Transaction Costs and Coalition Stability under Majority Rule," Economic Inquiry, Oxford University Press, vol. 41(2), pages 193-207, April. [Downloadable!] (restricted)
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  18. Barzel, Yoram, 1982. "Measurement Cost and the Organization of Markets," Journal of Law & Economics, University of Chicago Press, vol. 25(1), pages 27-48, April.
  19. McMillan, John & Woodruff, Christopher, 1999. "Dispute Prevention without Courts in Vietnam," Journal of Law, Economics and Organization, Oxford University Press, vol. 15(3), pages 637-58, October.
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