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Informal Markets, Perishability and Vertical Control: Brokerage of Artisanal Landings

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Abstract

This is a case study of the institutional changes occurring since the late 1990s at the Chilean Austral Hake (Merluccius Australis) artisanal fishery. This high-value exporting fishery, specialized in selling fresh-chilled products, represents a pioneering case of self-government developments within small-scale fishing communities exploiting mobile marine resources in Chile. Despite entry restrictions and global catch quotas, this fishery faced a productivity crisis between the late 1980s and the second half of the 1990s. Consequently, the fishermen started talks with the Government in order to introduce new management rules. After gradual evolution, today there prevails a well-developed system of de facto individual non-transferable quotas which are subject to a high degree of self-management by fishermen organisations. In order to understand the conditioning factors behind the exchange solutions found at this fishery, an analysis is provided of the industrial concentration and the strategies of vertical control between transacting parties along the production and marketing stages. The contractual issues analysed are: the use of informal markets, interlinkage contracting, temporal specificity due to product perishability, the use of different instruments of vertical control and the influence of increasing industrial concentration as we advance through the wholesale marketing channel and get closer to the retailing stages at final export markets.

Suggested Citation

  • Julio Peña Torres, 2005. "Informal Markets, Perishability and Vertical Control: Brokerage of Artisanal Landings," ILADES-Georgetown University Working Papers inv165, Ilades-Georgetown University, Universidad Alberto Hurtado/School of Economics and Bussines.
  • Handle: RePEc:ila:ilades:inv165
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    More about this item

    Keywords

    Food production and marketing; Production chains; Vertical control; Artisanal fishery; Chilean Austral Hake;

    JEL classification:

    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • J54 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Producer Cooperatives; Labor Managed Firms
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • L42 - Industrial Organization - - Antitrust Issues and Policies - - - Vertical Restraints; Resale Price Maintenance; Quantity Discounts
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • N56 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries - - - Latin America; Caribbean

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