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Static And Dynamic Efficiency Of Pooled Broiler Contracts: Relative-Performance Contracts Vs. Fixed-Performance Contracts

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  • Wang, Yanguo
  • Jaenicke, Edward C.

Abstract

With the broiler industry as a backdrop, this paper develops theoretical models to compare optimal incentives of pooled relative-performance and fixed-performance contracts in static and dynamic models that account for both adverse selection and moral hazard. In spite of some growers' complaints about the relative-performance contracts used in the broiler industry, model results largely justify the popularity and superiority of relative performance contracts relative to fixed performance contracts

Suggested Citation

  • Wang, Yanguo & Jaenicke, Edward C., 2004. "Static And Dynamic Efficiency Of Pooled Broiler Contracts: Relative-Performance Contracts Vs. Fixed-Performance Contracts," 2004 Annual meeting, August 1-4, Denver, CO 20406, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea04:20406
    DOI: 10.22004/ag.econ.20406
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    References listed on IDEAS

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    1. Perry, Janet E. & Banker, David E. & Green, Robert C., 1999. "Broiler Farms' Organization, Management, and Performance," Agricultural Information Bulletins 33739, United States Department of Agriculture, Economic Research Service.
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    4. Martinez, Stephen W., 1999. "Vertical Coordination in the Pork and Broiler Industries: Implications for Pork and Chicken Products," Agricultural Economic Reports 34031, United States Department of Agriculture, Economic Research Service.
    5. Theofanis Tsoulouhas & Tomislav Vukina, 2001. "Regulating Broiler Contracts: Tournaments Versus Fixed Performance Standards," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(4), pages 1062-1073.
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    7. Hayenga, Marvin L., 2000. "Meat Packer Vertical Integration and Contract Linkages in the Beef and Pork Industries: An Economic Perspective," Staff General Research Papers Archive 10564, Iowa State University, Department of Economics.
    8. Knoeber, Charles R & Thurman, Walter N, 1994. "Testing the Theory of Tournaments: An Empirical Analysis of Broiler Production," Journal of Labor Economics, University of Chicago Press, vol. 12(2), pages 155-179, April.
    Full references (including those not matched with items on IDEAS)

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