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The Cooperative Yardstick Revisited: Panel Evidence from the European Dairy Sectors

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  • Hanisch Markus
  • Müller Malte

    (Division of Cooperative Sciences, Department of Agricultural Economics, Humboldt-Universität zu Berlin, Berlin 10099, Germany)

  • Rommel Jens

    (Division of Resource Economics, Department of Agricultural Economics, Humboldt-Universität zu Berlin, Berlin 10099, Germany; Leibniz Institute of Agricultural Development in Central and Eastern Europe, Halle, Germany)

Abstract

Milk is an important agricultural product that has traditionally been processed by cooperatives. Across member states of the EU-27, however, large variation exists between the national market shares of cooperatives in dairy processing. Theoretical models suggest that a strong cooperative sector secures competitive regional prices for agricultural produce. Empirical studies which seek to quantify these effects are rare though. We use panel data to study the impact of cooperative strength – measured by market shares – on national farm gate milk prices in the EU-27 for the period from 2000 to 2010. Our results reveal a positive effect of cooperative market share on price that is relatively large and robust over different specifications of the econometric model. We conclude that dairy cooperatives have a pro-competitive effect and that exemptions for cooperatives from anti-trust regulation may be justified.

Suggested Citation

  • Hanisch Markus & Müller Malte & Rommel Jens, 2013. "The Cooperative Yardstick Revisited: Panel Evidence from the European Dairy Sectors," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 11(1), pages 151-162, December.
    • Handle: RePEc:bpj:bjafio:v:11:y:2013:i:1:p:151-162:n:11
    DOI: 10.1515/jafio-2013-0015
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    Cited by:

    1. Krisztina Melinda DOBAY, 2022. "The Resilience Of Agricultural Cooperatives In The Covid-19 Pandemic Time. Evidence From Romania," Agricultural Economics and Rural Development, Institute of Agricultural Economics, vol. 19(1), pages 13-30.
    2. Qiao Liang & Xinxin Wang, 2020. "Cooperatives as competitive yardstick in the hog industry?—Evidence from China," Agribusiness, John Wiley & Sons, Ltd., vol. 36(1), pages 127-145, January.
    3. Malvido Perez Carletti Agustina & Hanisch Markus & Rommel Jens & Fulton Murray, 2018. "Farm Gate Prices for Non-Varietal Wine in Argentina: A Multilevel Comparison of the Prices Paid by Cooperatives and Investor-Oriented Firms," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 16(1), pages 1-14, January.
    4. Jasper GRASHUIS & Ye SU, 2019. "A Review Of The Empirical Literature On Farmer Cooperatives: Performance, Ownership And Governance, Finance, And Member Attitude," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 90(1), pages 77-102, March.
    5. Maximilian Koppenberg & Stefan Hirsch, 2022. "Output market power and firm characteristics in dairy processing: Evidence from three EU countries," Journal of Agricultural Economics, Wiley Blackwell, vol. 73(2), pages 490-517, June.
    6. Stefano Ciliberti & Angelo Frascarelli & Gaetano Martino, 2020. "Drivers of participation in collective arrangements in the agri‐food supply chain. Evidence from Italy using a transaction costs economics perspective," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 91(3), pages 387-409, September.
    7. Jo H.M. Wijnands & Jos Bijman & Tanja Tramnitzke, 2017. "Analyses of the functioning of Milk Package provisions as regards producer organisations and collective negotiations," JRC Research Reports JRC107880, Joint Research Centre.
    8. Junying Lin & Zhonggen Zhang & Ziming Liu & Jens Rommel, 2020. "The impact of cooperatives’ transportation services on farm income: Evidence from tobacco farmers in Guizhou, China," Agribusiness, John Wiley & Sons, Ltd., vol. 36(1), pages 146-158, January.
    9. Höfer, Hanna-Helena & Rommel, Jens, 2015. "Internal governance and member investment behavior in energy cooperatives: An experimental approach," Utilities Policy, Elsevier, vol. 36(C), pages 52-56.
    10. Theo Benos & Nikos Kalogeras & Martin Wetzels & Ko De Ruyter & Joost M. E. Pennings, 2018. "Harnessing a ‘Currency Matrix’ for Performance Measurement in Cooperatives: A Multi-Phased Study," Sustainability, MDPI, vol. 10(12), pages 1-38, December.
    11. Jos BIJMAN & Markus HANISCH, 2020. "Understanding the heterogeneity among agricultural cooperatives," CIRIEC Working Papers 2013, CIRIEC - Université de Liège.
    12. Nilsson, Jerker & Helgesson, Matilda & Rommel, Jens & Svensson, Ellinor, 2020. "Forest-owner support for their cooperative's provision of public goods," Forest Policy and Economics, Elsevier, vol. 115(C).
    13. Kumse, Kaittisak & Suzuki, Nobuhiro & Sato, Takeshi & Demont, Matty, 2021. "The spillover effect of direct competition between marketing cooperatives and private intermediaries: Evidence from the Thai rice value chain," Food Policy, Elsevier, vol. 101(C).
    14. Ahmet Candemir & Sabine Duvaleix & Laure Latruffe, 2021. "Agricultural Cooperatives And Farm Sustainability – A Literature Review," Journal of Economic Surveys, Wiley Blackwell, vol. 35(4), pages 1118-1144, September.
    15. Yung-Chang WANG, 2017. "A conjectural variation approach to vertical integration in agricultural cooperatives," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 63(5), pages 228-233.
    16. Panos Fousekis, 2016. "Member Coordination Costs and Spatial Entry Deterrence in a Mixed Duopsony with a Cooperative," Spatial Economic Analysis, Taylor & Francis Journals, vol. 11(3), pages 340-354, July.
    17. Judit Nagy & Zsófia Jámbor, 2019. "Competitiveness in Dairy Trade – the Case of EU and the Visegrad Group Countries," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 11(4), December.
    18. Julia-Igual, J. & Melia-Marti, E., 2015. "Agri-food cooperative enterprises: From Ballestero to Bijman," Economia Agraria y Recursos Naturales, Spanish Association of Agricultural Economists, vol. 15(01).
    19. Federica Di Marcantonio & Enkelejda Havari & Liesbeth Colen & Pavel Ciaian, 2022. "Do producer organizations improve trading practices and negotiation power for dairy farms? Evidence from selected EU countries," Agricultural Economics, International Association of Agricultural Economists, vol. 53(S1), pages 121-137, November.
    20. Sagebiel, Julian & Müller, Jakob R. & Rommel, Jens, 2013. "Are Consumers Willing to Pay More for Electricity from Cooperatives? Results from an Online Choice Experiment in Germany," MPRA Paper 52385, University Library of Munich, Germany.
    21. Jos Bijman & Constantine Iliopoulos, 2014. "Farmers' Cooperatives in the Eu: Policies, Strategies, and Organization," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 85(4), pages 497-508, December.
    22. Zavelberg, Yvonne & Storm, Hugo, 2016. "Pricing behaviour of cooperatives and investor-owned dairies under spatial competition," Discussion Papers 250230, University of Bonn, Institute for Food and Resource Economics.
    23. Thomas Kopp & Ashok K. Mishra, 2022. "Perishability and market power in Nepalese food crop production," Journal of Agricultural Economics, Wiley Blackwell, vol. 73(2), pages 518-540, June.
    24. Viergutz, Tim & Schulze-Ehlers, Birgit, 2018. "Member Commitment and Switching Decisions in Dairy Cooperatives – A Factorial Survey," 2018 International European Forum (163rd EAAE Seminar), February 5-9, 2018, Innsbruck-Igls, Austria 276864, International European Forum on System Dynamics and Innovation in Food Networks.
    25. Yildiz, Özgür & Rommel, Jens & Debor, Sarah & Holstenkamp, Lars & Mey, Franziska & Müller, Jakob R. & Radtke, Jörg & Rognli, Judith, 2014. "Research Perspectives on Renewable Energy Cooperatives in Germany: Empirical Insights and Theoretical Lenses," MPRA Paper 55931, University Library of Munich, Germany.

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