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The Organizational Nature of Agricultural Cooperatives: A Perspective from the Farm Problem Theory

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  • Valentinov, Vladislav

Abstract

This article uses the farm problem theory as the framework for a comparative analysis of cooperative, market and hierarchical organization in the agrifood system. In order to carry out this analysis, the article proposes the organizational economics approach to the farm problem which supplements the traditional approaches explaining it in terms of low opportunity costs and high mobility costs of factors employed in agriculture. According to the proposed organizational economics approach, the farm problem is the outcome of inappropriateness of hierarchical and market organization for effective coordination of agricultural activities. The central argument of the article is that agricultural cooperatives are important because they partially perform the coordination functions not effectively delivered in agriculture by the conventional hierarchical and market types of economic organization.

Suggested Citation

  • Valentinov, Vladislav, 2005. "The Organizational Nature of Agricultural Cooperatives: A Perspective from the Farm Problem Theory," Journal of Rural Cooperation, Hebrew University, Center for Agricultural Economic Research, vol. 33(2), pages 1-13.
    • Handle: RePEc:ags:jlorco:45107
    DOI: 10.22004/ag.econ.45107
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    References listed on IDEAS

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    1. Condon, Andrew M. & Cotterill, Ronald W. & Rhodes, V. James & Shaffer, James D. & Staatz, John M., 1987. "Cooperative Theory: New Approaches," Service Reports (SR) 280614, United States Department of Agriculture, Rural Development.
    2. Glenn L. Johnson, 1960. "The State of Agricultural Supply Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 42(2), pages 435-452.
    3. Gardner, Bruce L, 1992. "Changing Economic Perspectives on the Farm Problem," Journal of Economic Literature, American Economic Association, vol. 30(1), pages 62-101, March.
    4. Claude Ménard, 2004. "The Economics of Hybrid Organizations," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 160(3), pages 345-376, September.
    5. Pollak, Robert A, 1985. "A Transaction Cost Approach to Families and Households," Journal of Economic Literature, American Economic Association, vol. 23(2), pages 581-608, June.
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    Cited by:

    1. Nowak, Piotr & GORLACH, KRZYSZTOF, 2015. "Rolnicy I Spółdzielczość W Polsce: Stary Czy Nowy Ruch Społeczny?," Village and Agriculture (Wieś i Rolnictwo), Polish Academy of Sciences (IRWiR PAN), Institute of Rural and Agricultural Development, vol. 1(166.1).
    2. Nowak Piotr & Jastrzębiec-Witowska Anna & Gorlach Krzysztof, 2016. "Cooperative Movements in Rural Areas in Contemporary Poland: A Brief Comparison of Farmers’ Attitudes of Members and Non-memebrs of Coooperatives," Eastern European Countryside, Sciendo, vol. 22(1), pages 151-164, December.
    3. Steele, Scott R., 2009. "Expanding the solution set: Organizational economics and agri-environmental policy," Ecological Economics, Elsevier, vol. 69(2), pages 398-405, December.
    4. Valentinov, Vladislav & Fritzsch, Jana, 2007. "Are Cooperatives Hybrid Organizations? An Alternative Viewpoint," Journal of Rural Cooperation, Hebrew University, Center for Agricultural Economic Research, vol. 35(2), pages 1-16.
    5. Caroline Gijselinck & Matthias Bussels, 2014. "Farmers' Cooperatives in Europe: Social and Historical Determinants of Cooperative Membership in Agriculture," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 85(4), pages 509-530, December.
    6. Ghanshyam Pandey, 2024. "Economic sustainability of rural cooperatives in Nepal - a bio-economy approach case study of Tulsipur sub-metropolitan city, Dang," Economics Working Papers 2024-01, University of South Bohemia in Ceske Budejovice, Faculty of Economics.
    7. Zhang, Shemei & Sun, Zhanli & Ma, Wanglin & Valentinov, Vladislav, 2020. "The effect of cooperative membership on agricultural technology adoption in Sichuan, China," China Economic Review, Elsevier, vol. 62(C).
    8. Raquel Ajates, 2021. "Reducing the Risk of Co-Optation in Alternative Food Networks: Multi-Stakeholder Cooperatives, Social Capital, and Third Spaces of Cooperation," Sustainability, MDPI, vol. 13(20), pages 1-20, October.

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