Understanding the System Context of Alternative Food Supply Chains

This paper focuses upon the case of alternative food supply chains (AFSCs) as a "laboratory" for the implementation of sustainability concepts on a larger scale. To realize this type of upscaling, two important conditions should be fulfilled: the initiatives have to combine a performing internal organisation with the ability to understand and interact with the larger food system. To explore these concepts, the theory of hybrid organisations and the system innovation policy approach are discussed. Theory and empirical evidence learns that both concepts are complementary, as they both stress the importance of networking with actors that can be situated within or outside the supply chain.Agribusiness, Industrial Organization,

The Global Organic Food Market and Transformation Deductive Definition of Empiric Indicators The Demand Explanation The Institutional Explanation & Comparative Country Report: Denmark versus Sweden

The present study is part of the project “Public Policies and Demand for Organic Food: An International Comparison of Policy Effects and Policy Determinants” (COP). It is carried out in WP II that concerns the supply-side policies and demand. In the WP it has been an initial task to formulate a theoretical approach as the conceptual framework to be used in comparative studies. The present study represents the first contribution to apply the conceptual framework in an empirical context and here it is the evolution of the organic sectors in Denmark and Sweden that are compared. The study is searching for indicators to explain which factors can explain increase in organic foods production and consumption. It reaches the conclusion that the picture concerning the demand side is very blurred and that it is impossible to reveal which elements are crucial. However, the study also concludes that institutional design and set up seem to be rather crucial for the evolution of the organic sector

Markets, Contracts, or Integration? The Adoption, Diffusion, and Evolution of Organizational Form

The rise of contract farming and vertical integration is one of the most important changes in modern agriculture. Yet the adoption and diffusion of these new forms of organization has varied widely across regions, commodities, or farm types, however. Transaction cost theories and the like are not fully effective at explaining the variation of adoption rates of different organizational forms, in part because of their inherent static nature. In order to explain the adoption, diffusion and evolution of organizational form, a more dynamic framework is required. This paper lays out such a framework for understanding the evolution of organizational practices in U.S. agriculture by drawing on existing theories of economic organization, the diffusion of technological innovation, and organizational complementarities. Using recent trends as stylized facts we argue that the agrifood sector is characterized by strong complementarities among its constituent features and that these complementarities help explain the stylized facts. We also discuss several testable hypotheses concerning changes in organizational form in agriculture.contracting, vertical integration, organizational innovation, diffusion, Institutional and Behavioral Economics, L14, L22, Q13, O33,

One Player Games versus Two Player Games: Comparing Agribusiness Cooperatives with Investor-Owned Business Models

Cooperative business firms are prevalent in agribusiness, yet no concise generalized model exists to demonstrate how and why cooperative firms differ from, and may be selected over, the more common investor owned business firm. It is shown within a generic transaction game that cooperatives fill both producer and consumer roles as an aggregated player that is expected to maximize aggregate producer and consumer payoffs rather than maximizing either payoff separately, which contrasts with investor owned firms as essentially two player games between separate and competing producers and consumers where each player seeks to maximize their separate payoff individually. A cardinally valued game theoretic matrix is used to demonstrate the expected differences between these one-player versus two-player games, which clearly demonstrates that cooperatives are expected to achieve greater total payoffs and social welfare relative to investor owned firms, because investor owned firms generate dead weight loss when maximizing producer surpluses as expected under prevailing microeconomic theory. The use of cardinal payoff values rather than ordinal is important because it permits aggregation of payoffs within the model, and because it directly reflects the cardinal payoffs actually used in agribusiness decisions, such as revenue, expense and profit measures. The results may indicate the reason that cooperative firms are selected and have been successful in agribusiness. However, weaknesses of the cooperative model are also discussed, conjecturing that cooperatives may be preferable to investor owned businesses under limited circumstances but because these circumstances occur frequently in agribusiness the cooperative model is observed more frequently there.Cooperatives, Game Theory, Collective Action, Agricultural Economics, Theory of the Firm, Agribusiness, B5, C7, D7, L2, L3, Q1,

Incentive Decision on Safety Investment of Supply Chain of Agricultural Products in “Agricultural Super-Docking”

Since the “agriculture super-docking” mode was introduced in China in 2007, remarkable success has been made in reducing the transaction cost and improving the quality safety of agricultural products. However, the quality safety issues of agricultural products still occur frequently because both specialized farmers’ cooperatives and supermarkets have insufficient safety investment. In order to study the necessity, goal, and incentive decision schemes of safety investment in “agriculture super-docking” supply chain, three kinds of models, which include noncooperatives distributed decision-making model, centralized decision-making model, and incentive coordination models led by cooperatives and supermarkets, are, respectively, set up in this paper. Conclusions are drawn as follows: when making the uncooperative decentralized decision, both cooperatives and supermarkets have the moral risks to decrease the safety investment, but appropriate measures can achieve the coordination of the supply chain; when achieving the coordination of supply chain, the two contacts under the guidance of cooperatives and supermarkets are the same, and the schemes of distributing profits are also the same. Moreover, a practical case is given to improve the effectiveness and feasibility of the incentive decision schemes

Policy Reform in Sub Saharan Africa

Agricultural adjustment policies in sub Saharan Africa have not delivered substantial increases in agricultural growth. We examine alternative explanations for this and argue that transitions and thresholds in agricultural growth processes are not sufficiently recognised and understood in dominant policy discourses. This is a particular problem with market failures for goods and services with private good characteristics and we need a greater emphasis on and understanding of the causes and nature of coordination failures which lead to these market failures. This paper examines core features of poor rural areas, the nature of coordination problems faced by different potential economic actors, the impacts of these problems on markets and economic development, and the ways that these have been addressed or ignored in different policies and policy approaches in Asia and Africa in the last 40 years. We conclude by drawing out the implications for policies seeking to promote pro-poor economic growth in poor rural areas today.Agricultural and Food Policy,

INTERNATIONAL INVESTMENT MOTIVATIONS OF U.S. WINERIES

This study used personal and telephone interviews of wine industry executives and observers to examine the foreign direct investment motivations of U.S. wineries. Underlying most winery motivations was the recognition that U.S. wineries sense increasing pressure to offer a competitive range of wines that meet the price/quality needs of consumers and retailers in important markets and market segments. Wineries' marketing plans are often constrained by their ability to obtain adequate grape and juice supplies that meet important price and quality criteria, especially when domestic grape production drops. The importance of product portfolios and the industry's resource dependence have placed tremendous pressures on U.S. wineries to coordinate winegrape and juice acquisitions, especially as retailers consolidate their supply chains. Some U.S. wineries have invested abroad in response to these pressures while others have not. Interview results suggest that foreign investments by U.S. wineries were primarily motivated by the need for greater access to stable or adequate winegrape/juice supplies, the need for more control over the winegrape costs within given quality levels, and the desire to expand wine portfolios.International Relations/Trade,

Market and Coordination Failures in Poor Rural Economies: Policy Implications for Agricultural and Rural Development

This paper argues that the disappointing outcomes of adjustment policies in poor rural economies, principally in sub-Saharan Africa, can be partly attributed to weaknesses in the neo-classical theory which underlies these polices and from associated failures to recognise structural changes (or transitions) in growing agricultural economies. After a brief description of agricultural policy changes in sub Saharan Africa, the mixed achievements of market liberalisation policies are explained using new institutional economic arguments regarding inherent difficulties in economic coordination in poor economies, difficulties which markets themselves cannot overcome. A novel framework is put forward for understanding coordination failure and integrating it with other causes of under-development notably low levels of technical and institutional development and poor governance. The paper concludes by considering the implications of these arguments for development policies in different sub-Saharan economies.development, coordination, markets, institutions, Marketing, O12, O17, Q12,

AGROINDUSTRIALIZATION IN EMERGING MARKETS: OVERVIEW AND STRATEGIC CONTEXT

This article offers an overview for a special issue on agroindustrialization. It reviews eleven articles analyzing the agroindustrialization process in Latin America and Asia. It sets out a conceptual framework from the organizational economics and strategic management literature to enhance the understanding of the process of agroindustrialization from a competitive strategy point of view.Agribusiness, Industrial Organization,