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Vertical coordination from the angle of farmer loyalty and access to credit. Evidence from the Polish dairy sector

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Author Info
Jan Fałkowski () (Faculty of Economic Sciences, University of Warsaw)

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Abstract

Numerous studies have shown that processing and retail industries have actively engaged in assisting farmers to join the modern food marketing systems. Data from the Polish dairy sector shows that assistance is provided not only for the traditional-channel farmers wishing to modernise, but also for farmers already included in the modern marketing channel. Drawing on the literature two explanations could be provided to account for this phenomenon: 1) even the modern-channel farmers lack sufficient funds to maintain required quality/quantity on their own; 2) after undertaking the necessary adjustments the modern-channel farmers are more likely to quit their relationship with current processor and turn elsewhere so the assistance is needed to prevent them from doing that. Basing on the household data, it is robustly found that these hypotheses could provide at most partial explanation for vertical linkages observed between modern-channel processors and farms. The present paper takes advantage of logit models, instrumental variables’ approach, panel data estimations as well as propensity score matching methods.

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File URL: http://www.wne.uw.edu.pl/inf/wyd/WP/WNE_WP1.pdf
File Format: application/pdf
File Function: First version, 2008
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Publisher Info
Paper provided by Faculty of Economic Sciences, University of Warsaw in its series Working Papers with number 2008-01.

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Length: 22 pages
Date of creation: 2008
Date of revision:
Handle: RePEc:war:wpaper:2008-01

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Related research
Keywords: vertical coordination; access to credit; farmer loyalty; dairy sector; Poland;

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Find related papers by JEL classification:
Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Joshua Angrist & Alan Krueger, 2001. "Instrumental Variables and the Search for Identification: From Supply and Demand to Natural Experiments," Working Papers 834, Princeton University, Department of Economics, Industrial Relations Section.. [Downloadable!]
    Other versions:
  2. Gow, Hamish R & Swinnen, Johan F M, 2001. " Private Enforcement Capital and Contract Enforcement in Transition Economies," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 83(3), pages 686-90, August. [Downloadable!] (restricted)
  3. Sexton, Richard J. & Lavoie, Nathalie, 2001. "Food processing and distribution: An industrial organization approach," Handbook of Agricultural Economics, in: B. L. Gardner & G. C. Rausser (ed.), Handbook of Agricultural Economics, edition 1, volume 1, chapter 15, pages 863-932 Elsevier. [Downloadable!] (restricted)
  4. Heckman, James J & Ichimura, Hidehiko & Todd, Petra, 1998. "Matching as an Econometric Evaluation Estimator," Review of Economic Studies, Blackwell Publishing, vol. 65(2), pages 261-94, April. [Downloadable!] (restricted)
  5. Ian Sheldon & Richard Sperling, 2003. "Estimating the Extent of Imperfect Competition in the Food Industry: What Have We Learned?," Journal of Agricultural Economics, Blackwell Publishing, vol. 54(1), pages 89-109. [Downloadable!] (restricted)
  6. repec:fth:prinin:455 is not listed on IDEAS
  7. Cotterill, Ronald W., 1999. "Continuing Concentration in Food Industries Globally: Strategic Challenges to an Unstable Status Quo," Research Reports 25190, University of Connecticut, Food Marketing Policy Center. [Downloadable!]
  8. Sascha O. Becker & Andrea Ichino, 2002. "Estimation of average treatment effects based on propensity scores," Stata Journal, StataCorp LP, vol. 2(4), pages 358-377, November. [Downloadable!]
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