IDEAS home Printed from https://ideas.repec.org/p/ags/rvaewp/24176.html

The Advantage of Cooperatives under Asymmetric Cost Information

Author

Listed:
  • Bogetoft, Peter
  • Jensen, Peter Max Friis
  • Olsen, Rene H.

Abstract

We consider how to organize the processing and marketing of an agricultural product when farming costs are known only by the individual farmers. We show that when marginal costs are un-correlated and the market for final goods is competitive, the socially optimal production levels may be sustained by a cooperative and a cooperative only. We show also that the cooperative form is particularly useful when the uncertainty is large and the net revenue product is small.

Suggested Citation

  • Bogetoft, Peter & Jensen, Peter Max Friis & Olsen, Rene H., 1999. "The Advantage of Cooperatives under Asymmetric Cost Information," Unit of Economics Working Papers 24176, Royal Veterinary and Agricultural University, Food and Resource Economic Institute.
    • Handle: RePEc:ags:rvaewp:24176
    DOI: 10.22004/ag.econ.24176
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/24176/files/ew990006.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.24176?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Rick Antle & Gary D. Eppen, 1985. "Capital Rationing and Organizational Slack in Capital Budgeting," Management Science, INFORMS, vol. 31(2), pages 163-174, February.
    2. Jean-Jacques Laffont & Jean Tirole, 1993. "A Theory of Incentives in Procurement and Regulation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262121743, December.
    3. George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 84(3), pages 488-500.
    4. Myerson, Roger B, 1979. "Incentive Compatibility and the Bargaining Problem," Econometrica, Econometric Society, vol. 47(1), pages 61-73, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wagner, Stephan M. & Friedl, Gunther, 2007. "Supplier switching decisions," European Journal of Operational Research, Elsevier, vol. 183(2), pages 700-717, December.
    2. Thomas Pfeiffer & Georg Schneider, 2007. "Residual Income-Based Compensation Plans for Controlling Investment Decisions Under Sequential Private Information," Management Science, INFORMS, vol. 53(3), pages 495-507, March.
    3. Peter Bogetoft, 2000. "DEA and Activity Planning under Asymmetric Information," Journal of Productivity Analysis, Springer, vol. 13(1), pages 7-48, January.
    4. Maria Psillaki, 1998. "Une présentation critique des mécanismes de révélation appliqués au marché du crédit," Revue Française d'Économie, Programme National Persée, vol. 13(2), pages 29-58.
    5. Michael A. Arnold & Joshua M. Duke & Kent D. Messer, 2013. "Adverse Selection in Reverse Auctions for Ecosystem Services," Land Economics, University of Wisconsin Press, vol. 89(3), pages 387-412.
    6. Andrea Attar & Thomas Mariotti & François Salanié, 2020. "The Social Costs of Side Trading," The Economic Journal, Royal Economic Society, vol. 130(630), pages 1608-1622.
    7. Josheski Dushko & Karamazova Elena, 2021. "Auction theory and a note on game mechanisms," Croatian Review of Economic, Business and Social Statistics, Sciendo, vol. 7(1), pages 43-59, May.
    8. Dionne, G. & Doherty, N., 1991. "Adverse Selection In Insurance Markets: A Selective Survey," Cahiers de recherche 9105, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
    9. Vasiliki Skreta, 2011. "On the informed seller problem: optimal information disclosure," Review of Economic Design, Springer;Society for Economic Design, vol. 15(1), pages 1-36, March.
    10. João Vareda, 2007. "Access Regulation under Asymmetric Information about Demand," Working Papers 30, Portuguese Competition Authority.
    11. Strausz, Roland, 2006. "Deterministic versus stochastic mechanisms in principal-agent models," Journal of Economic Theory, Elsevier, vol. 128(1), pages 306-314, May.
    12. Qi Chen, 2003. "Cooperation in the Budgeting Process," Journal of Accounting Research, John Wiley & Sons, Ltd., vol. 41(5), pages 775-796, December.
    13. Iñaki Aguirre & Arantza Beitia, 2004. "Regulating a Monopolist with Unknown Demand: Costly Public Funds and the Value of Private Information," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 6(5), pages 693-706, December.
    14. Élodie Bertrand, 2006. "La thèse d'efficience du « théorème de Coase ». Quelle critique de la microéconomie ?," Revue économique, Presses de Sciences-Po, vol. 57(5), pages 983-1007.
    15. Clément Carbonnier, 2023. "Welfare Economics and Neoliberalism: Interpreting the ideal type of perfect competition general equilibrium," Working Papers hal-04062786, HAL.
    16. Alexia Gaudeul, 2009. "A (Micro) Course in Microeconomic Theory for MSc Students," Working Papers id:1986, eSocialSciences.
    17. Shouqiang Wang & Peng Sun & Francis de Véricourt, 2016. "Inducing Environmental Disclosures: A Dynamic Mechanism Design Approach," Operations Research, INFORMS, vol. 64(2), pages 371-389, April.
    18. Cabrales, Antonio & Charness, Gary, 2011. "Optimal contracts with team production and hidden information: An experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 77(2), pages 163-176, February.
    19. Signe ANTHON & Peter BOGETOFT & Bo Jellesmark THORSEN, 2007. "A Bureaucrat'S Procurement Strategy: Budget Constraints And Rationing," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 78(2), pages 221-244, June.
    20. Bester, Helmut & Ouyang, Yaofu, 2018. "Optimal procurement of a credence good under limited liability," International Journal of Industrial Organization, Elsevier, vol. 61(C), pages 96-129.

    More about this item

    Keywords

    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:rvaewp:24176. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/foikudk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.