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Learning Process and Contract Adaptation with Quality Uncertainty: Some Paradoxes in Retailer-Producer Relationships

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  • Maze, Armelle

Abstract

The optimal level of formalisation of contracts and their dynamic is at stake in the economic literature on the optimum design of ex post renegotiation with third party enforcement. Another theoretical interpretation is that contract adaptations may also reflect mutual learning process between contractors. Why transactors write explicit contract that they know cannot be court enforced? The central idea is that explicit contract terms makes it clearer to the transactors what has been agreed upon, thus are decreasing the cost of private enforcement sanctions (Klein, 1996). Empirical evidences are provided by the diachronic analysis of the full set of tri-partite contracts between one of the top-ten french large retailer and its beef suppliers before and after the BSE crisis (period 1993-1999). The analysis emphasizes also the role of this increased codification of supply contracts with a progressive change in the internal retailer's organization, i.e. increased centralization of decision and supervision mechanisms. Contract design and organizational choices are then strongly interrelated.

Suggested Citation

  • Maze, Armelle, 2002. "Learning Process and Contract Adaptation with Quality Uncertainty: Some Paradoxes in Retailer-Producer Relationships," 2002 International Congress, August 28-31, 2002, Zaragoza, Spain 24957, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae02:24957
    DOI: 10.22004/ag.econ.24957
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    References listed on IDEAS

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    Cited by:

    1. Hernandez-Sanchez, Alberto, 2005. "Fresh Fruit Producers Organizations in France: The Impact of HACCP and ISO 9000 Standards Adoption," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 40, March.

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