Endogenous Matching and Contractual Choice between Agricultural Processors and Farmers in China

Contracts are widely used by agricultural processors for purchasing inputs not only in developed countries but also in developing countries such as China. The total number of formal, written contracts between farmers and food processors is increasing rapidly in China, and the formal contracts that exist are becoming more complex. Contractual design in China is evolving from simple price-quantity contracts toward more complicated arrangements known as cooperation contracts or joint-stock cooperation contracts, designed to share risk and mitigate opportunistic behaviors by the contracting parties. Due to small farm sizes, the contracted amount in the typical contract in China is very small compared with Western countries, and each processor usually has a large number of contracted farmers. This paper uses data from a 2003 survey of food processing firms by the Chinese Ministry of Agriculture to analyze the determinants of contractual choices between these firms and farmers and the number of farmers that each firm contracts with. An important issue identified in the literature in analyzing the determinants of contractual choices is endogenous matching between parties to a contract and the effects of this endogenous matching on contract choice. We find strong evidence to support endogenous matching. In particular, our results indicate that firms which contract with a larger number of farms are more likely to use cooperation contracts than relational contracts.China, contractual design, endogenous matching, farms, food processing, Agribusiness, Industrial Organization, Q13, L14,

Dancing with the Dragon Heads: Enforcement, Innovations and Efficiency of Contracts between Agricultural Processors and Farmers in China

Contractual breaches are very common in developing countries such as China. In order to prevent breaches of contract, the contractual designs between farmers and agricultural processors (Dragon Head Firms) in China are innovating in two ways: organizational innovations and contractual innovations. Due to contractual innovations, simple price-quantity contracts are evolving into complex cooperation contracts. Using data for over 500 state key processors in 2003 from the Chinese Ministry of Agriculture, we construct econometric models to study contractual choices, contract intensity, and their impacts on sales and profits for agricultural processors in China. The results indicate that capital and the number of contracted farmers are endogenous to contract choices. Processors are more likely to use cooperation contracts compared with price-quantity contracts as the number of contracted farmers increases, because the costs of coordinating, monitoring and enforcing price-quantity contracts may increase dramatically under these circumstances . On the other hand, contract types are not important for the number of contracted farmers, the intensity of contracts, or sales and profits for processors. The results also indicate that the elasticity of profits with respect to capital is 0.52, which implies that the returns to investing in the food processing industry are relatively high in China.Agribusiness,

The contracts between leading agribusiness enterprises and rural households: its effects on firm-level export of agricultural products

In this paper, transaction cost is introduced into the general firm-level export behavior model. By so doing, we build a theoretical model explaining how connection modes between leading agribusiness enterprises and rural households affect the firm-level agricultural products export. Analyzing the dataset of 561 national leading agribusinesses of the year 2003, we use Tobit model to estimate the firm-level export effect of the connection modes. The empirical result demonstrates that connections in the mode of stock-cooperation or cooperation contracts have a significant positive effect on the enterprises export and export ratio. In addition, the connection with more characteristics of factor contract has stronger effect on export than that with commodity contract characteristics.Contracts; Agribusiness; Rural Households; Firm-level; Export

Contentious Institutions: An Augmented Rational-Actor Analysis of the Origins and Path Dependency of Welfare State Institutions in the Western Countries

Welfare states in the Western countries have had very similar goals, yet the choice of institutions to approach these shared goals has generated protracted power struggles among major interest groups and great cross-country variation in institutional structures. Relating recent debates on new institutionalism to earlier debates on power, this paper outlines an augmented rational-actor approach to the explanation of the origins of welfare state institutions and of variations in their degree of path dependence. With a differentiated concept of power costs and the degree of power asymmetry among actors as a central variable, this augmented model partly combines some salient characteristics of the rational-choice, historical, and sociological versions of new institutionalism. The augmented rational-actor approach proves fruitful in understanding conflicts characterizing the emergence and change of major social insurance institutions in 18 rich Western countries since the late nineteenth century and up to the present. It complements rational-choice institutionalism focused on voluntary cooperation, contracts and conventions.rationality; new institutionalism; welfare states; power; institutional change

In Search of Excellence in Research and Policy Advice: Success Factors for International Competitiveness

Forschung; Forschungsinstitut; Internationaler Wettbewerb; Politikberatung; Qualitätsmanagement; Hochqualifizierte Arbeitskräfte; Personalwesen; Deutschland

Formal Knowledge Examination Institutions: Chance Or Threat to European Medium Tech-Nology SMEs? A Cognitive and Institutional Perspective

For most SME in incumbent medium-technology sectors, international business is only possi-ble, if additional support by specified institutions is provided. These additional services in-clude information on foreign markets – regulation, market partners, sales potential – as well as coordination – for trade fairs, common international recruitment and qualification strategies – and capabilities like access to financial markets or international public funding for interna-tionalisation or cutting-edge technological knowledge. For many of these services, private provision is possible, as exclusive use and rivalry in consumption are given. For other ser-vices, however, network characteristics restrict a completely private provision. The proposed paper analyses institutional arrangements particularly designed on regional, national or European level to support linkages between organisations and networks in differ-ent European regions. The investigation is based on information collected within the frame-work of the “IKINET project – International Knowledge and Innovation Network†(EU FP6, N° CIT2-CT-2004-506242). The specific challenge of the institutions investigated within this paper refers to linkages between organisations and networks with different institutional de-signs, e.g. the role of public and/or private supply, the characteristics and subjects of services, organisational structures and modes of coordination. These institutions attempt to bridge the gap between SME and organisations in different regions, but also to ease the access to EU funding for transnational (transregional) cooperation between SME. The paper will analyse their products, organisational structure, funding and codes of interaction. This investigation will be used to identify general and regionally specific prerequisites for effective interregional boundary spanning institutions. Secondly, the connectivity between the institutions will be analysed to reveal necessary standards or institutional arrangements to secure interregional trust in cooperation. These standards can range from rather informal, for example on the basis of business norms in trade fairs, to completely formal arrangements, for example in the case of contractual agreements on intellectual property rights and licenses. The assessment of these institutional arrangements uses an integrative methodological framework based on institu-tional analysis to overcome information asymmetries in cooperative innovative processes, sociological and cognitive psychological models of organisational and cognitive proximity and management models for SME as learning organisations. As a result, insights are expected for the European Union, which institutional arrangements are necessary for technology plat-forms on a regional level to secure interregional knowledge interactions.

ANALYSIS OF COOPERATION BETWEEN CLASS XII IIS 2 STUDENTS IN MUHAMMADIYAH 1 PONTIANAK HIGH SCHOOL

This study aimed to describe the spontaneous cooperation, contracts, and traditional inter IIS 2 class XII students at SMA Muhammadiyah 1 Pontianak. The method used is qualitative approach. The results showed that spontaneous cooperation among students have been executed better, but not perfect because there are students who are less well spontaneous cooperation. Besides the cooperation contract between the students has been reached with the good, it is characterized by cooperation between students when carrying picket class and their prayer materials to other students. While the traditional cooperation between students has also been going well between them visible influence each other as well as snacks at canteen, there is always one of the students who invited more friends for snacks at canteen together, and call it received good response by other friends to be said that these interactions may affect the behavior of other individuals by creating social relations among the