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Farmers’ Choices Among Alternative Dairy Marketing Channels in Armenia: Can Appropriately Designed ODA Substitute for FDI?

Author

Listed:
  • Gow, Hamish
  • Shanoyan, Aleksan
  • Cocks, Jack

Abstract

The Armenian dairy sector has until recently remained in a sub optimal equilibrium characterized by low quality milk, delayed payments, deep financial distress and a general lack of investment. The decision of the USDA MAP to expand their agribusiness programs into the dairy sector in 1999 however initiated a rapid revitalization and expansion of the sector. The USDA MAP used various organizational models at both the processor and farmer level to facilitate this revitalization. Given the lack of FDI and successful ODA initiated restructuring, the USDA MAP project provides an instrumental case study for analyzing where an ODA-induced public solution rather than a FDI-induced private solution has been used to link farmers to markets and solve the related contracting, investment, and enforcement problems. The paper analyzes the impact of third-party facilitated marketing channels on economic and social outcomes of small, financially distressed farmers and examines the factors affecting farmers’ choices among alternative marketing channels.

Suggested Citation

  • Gow, Hamish & Shanoyan, Aleksan & Cocks, Jack, 2009. "Farmers’ Choices Among Alternative Dairy Marketing Channels in Armenia: Can Appropriately Designed ODA Substitute for FDI?," Journal of Rural Cooperation, Hebrew University, Center for Agricultural Economic Research, vol. 37(01), pages 1-24.
    • Handle: RePEc:ags:jlorco:163767
    DOI: 10.22004/ag.econ.163767
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    References listed on IDEAS

    as
    1. Peter Walkenhorst, 2000. "Foreign Direct Investment, Technological Spillovers and the Agricultural Transition in Central Europe," Post-Communist Economies, Taylor & Francis Journals, vol. 12(1), pages 61-75.
    2. Gow, Hamish R. & Streeter, Deborah H. & Swinnen, Johan F. M., 2000. "How private contract enforcement mechanisms can succeed where public institutions fail: the case of Juhocukor a.s," Agricultural Economics, Blackwell, vol. 23(3), pages 253-265, September.
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    4. Phil Simmons, 2002. "Overview of Smallholder Contract Farming in Developing Countries," Working Papers 02-04, Agricultural and Development Economics Division of the Food and Agriculture Organization of the United Nations (FAO - ESA).
    5. Cocks, Jack & Gow, Hamish R., 2003. "Supplier Relationship Development In The Food Industry Of Transition Economies: The Case Of Interbrew," Journal of Food Distribution Research, Food Distribution Research Society, vol. 34(01), pages 1-6, March.
    6. Hamish R. Gow & Johan F. M. Swinnen, 2001. "Private Enforcement Capital and Contract Enforcement in Transition Economies," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(3), pages 686-690.
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    Cited by:

    1. Shanoyan, Aleksan & Brent Ross, R. & Gow, Hamish R. & Christopher Peterson, H., 2014. "Long-term sustainability of third-party facilitated market linkages: Evidence from the USDA marketing assistance program in the Armenian dairy industry," Food Policy, Elsevier, vol. 46(C), pages 157-164.

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