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On the emergence of new growers' associations: self-selection versus countervailing power


  • George Hendrikse
  • Jos Bijman


Increasing differentiation on the supply side of agricultural and horticultural markets has resulted in the emergence of new growers' associations (GAs). These GAs face a trade-off between self-selection and countervailing power, which is analysed with an incomplete contracting model. Heterogeneous GAs frustrate high-quality growers as a result of the policy of applying the equality principle, but they are strong in terms of countervailing power of the growers collectively. The opposite holds for homogeneous GAs. Homogeneous GAs prevail when the benefits of product differentiation are large, or when low-quality producers can be driven out of the market. An efficiency rationale for EU Regulation (EC) No. 2200-96 is formulated. Copyright 2002, Oxford University Press.

Suggested Citation

  • George Hendrikse & Jos Bijman, 2002. "On the emergence of new growers' associations: self-selection versus countervailing power," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 29(2), pages 255-269, June.
  • Handle: RePEc:oup:erevae:v:29:y:2002:i:2:p:255-269

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    References listed on IDEAS

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    Cited by:

    1. Agbo, Maxime & Rousselière, Damien & Salanié, Julien, 2015. "Agricultural marketing cooperatives with direct selling: A cooperative–non-cooperative game," Journal of Economic Behavior & Organization, Elsevier, vol. 109(C), pages 56-71.
    2. Paul Diederen & Hans van Meijl & Arjan Wolters, 2003. "Modernisation in agriculture: what makes a farmer adopt an innovation?," International Journal of Agricultural Resources, Governance and Ecology, Inderscience Enterprises Ltd, vol. 2(3/4), pages 328-342.
    3. Peter Bogetoft & Henrik B. Olesen, 2002. "Influence Costs in Heterogeneous Cooperatives: A Formal Model of Sales Distortion," CIE Discussion Papers 2002-05, University of Copenhagen. Department of Economics. Centre for Industrial Economics.
    4. Angelo Zago, 2004. "Quality Production and Quality Indicators in Intermediate Products," Working Papers 16/2004, University of Verona, Department of Economics.
    5. Benmehaia, Mohamed Amine & Brabez, Fatima, 4. "The Propensity To Cooperate Among Peasant Farmers In Algeria: An Analysis From Bivariate Approach," International Journal of Food and Agricultural Economics (IJFAEC), Alanya Alaaddin Keykubat University, Department of Economics and Finance, vol. 4(4).
    6. Armelle Mazé, 2005. "Contract Law and the self-enforcing range of contracts in agriculture," Working Papers halshs-00354960, HAL.
    7. Djanibekov, Nodir & Djanibekov, Utkur & Sommer, Rolf & Petrick, Martin, 2015. "Cooperative agricultural production to exploit individual heterogeneity under a delivery target: The case of cotton in Uzbekistan," Agricultural Systems, Elsevier, vol. 141(C), pages 1-13.
    8. Maze, Armelle, 2006. "Multilateral reputation mechanisms and contract law in agriculture : complement or substitutes," 2006 Annual meeting, July 23-26, Long Beach, CA 21285, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    9. repec:hal:journl:halshs-01098762 is not listed on IDEAS
    10. Jan Falkowski & Pavel Ciaian, 2016. "Factors Supporting the Development of Producer Organizations and their Impacts in the Light of Ongoing Changes in Food Supply Chains: A Literature Review," JRC Working Papers JRC101617, Joint Research Centre (Seville site).

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