"Co-Operative Identity" - A Theoretical Concept for Dynamic Analysis of Practical Co-Operation: The Dutch Case

The "concept of the co-operative identity" (consisting from the definition, aims and functions of cooperatives and the so-termed co-operative principles) serves as a general theoretical background for the economic analysis of agricultural co-operation. The development of Dutch dairy co-operatives is used as a case study example, which suitably illustrates and represents the processes taking place in the European Union. Some suggestions for further research on the co-operative identity according to each country and different branches and sectors in order to see the substance of co-operation from different economic and non-economic aspects are proposed.agriculture, co-operative, identity, principles, strategy, Agribusiness, Q13, L14, L22,

Integration of small and medium size farmers by co-operatives in the Hungarian fruit and vegetable sector - a case study

The main co-ordinators/channels used in Hungarian fruit and vegetable supply chain are the following: local market, wholesale markets, production co-operatives, marketing cooperatives, producers organisation, processing industry, wholesalers and retailers. Different retail chains gain a progressively larger share of the fresh fruit and vegetable market. It is very important, therefore, that the farmers have to use marketing channels which could give them the strengths (countervailing power) of more concentrated organisations. In this case study, we examine the integration role of Mórakert Purchasing and Service Co-operative, in Mórahalom in county Csongrád which can be found in the southern east part of Hungary. The Morakert co-operative active in the fruit and vegetable sector and it was the first officially acknowledged Producers Organisation (PO) in Hungary. It works as a very successful cooperative (e.g. in terms of increasing annual turnover and membership) thus being a good example for a number of emerging producer organisations.fruit and vegetable, integration, co-operatives, Producers Organisation, Hungary, Agribusiness, Farm Management,

“Co-operative identityâ€: A theoretical concept for economic analysis of practical co-operation dynamics

Farmers’ problems and co-ordination of agricultural activities cannot be solved simply by EU and/or government support, or by private market co-ordination institutions. Emerging producer groups and co-operatives seem vital in achieving bargaining power. Theoretically, and according to Western European (Dutch, Danish etc.) and US practical experience, one of the major important private institutions that can strengthen producers and help co-ordinate (agricultural) chains is the co-operative entity. To fulfill the basic co-operative aims and to compete in a more market-oriented environment (e.g. more liberal agricultural policies, opening European and world market, etc.) they will initiate new marketing strategies. To implement such new marketing strategies, co-ops have to collect more risk capital and in Western European agricultural co-operatives this is currently precipitating some fundamental financial and organisational changes. To retain the basic co-operative character, they are undertaking internal and external organisational changes, which in a number of cases will create so-called new co-operative structures/models. In this paper the “co-operative identity†concept (meaning the aims and functions of co-operatives, as well as the so-termed co-operative principles) is proposed to serve as a general theoretical background to evaluate economically the flexibility of (agricultural) cooperation. Also proposed is a new, interdisciplinary research focus (including comprehensive theoretical overview). This new focus examines the substance of co-operation and emphasises the importance of combining insights across the social sciences. It uses the results and common findings of economics, law, marketing, financing, organisational studies, management sciences (“hard†sciences), and also some elements of philosophy, psychology, sociology etc. (“soft†disciplines). Also recommended are some suggestions for further comparative research on the “co-operative identityâ€. This is carried out according to each country and different branches and sectors to observe the substance and dynamics of co-operation from different economic and non-economic aspects.Co-operation, co-operative identity, co-operative principles, strategy, marketing, co-ordination, vertical integration, agriculture, Farm Management, Marketing,

CHANGES IN THE STRUCTURE OF AGRICULTURAL PRODUCTION, FARM STRUCTURE AND INCOME IN HUNGARY IN THE PERIOD OF 2004-2006

This study reviews the major changes in Hungarian agriculture that occurred between 2004 and 2006. Subjects investigated will include the structural shift towards crop production, the drastic decrease in the foreign food trade balance, and agricultures deteriorating capacity to sustain and retain a rural population. (Hereinafter: sustaining and retaining capacity of agriculture). The author will diagnose related problems, but will not offer any solutions. Nevertheless, he will present a perspective stipulating that Hungarian agricultures chronic problems require an agricultural strategy based on political consensus.EU accession, structural change, foreign food trade, sustaining and retaining capacity of agriculture, agricultural strategy, Farm Management,

Vertical Co-ordanitaion in Transition Agriculture: a Hungarian Cooperative Case Study

The agriculture is traditional risky business, but in transition countries agricultural producers should face some additional difficulties. The agri-food chains are still suffering from underdeveloped market institutions creating severe barriers for price discovery and high transaction costs to co-ordinate market exchanges. Co-operatives are usually neglected as a possible governance structure in recent empirical analyses. This study analyzes the advantages and limitations of cooperatives for establishing an appropriate vertical coordination forms in the framework of transaction cost economics. We present a case study to show that at the recent stage of development in Hungarian agriculture co-operatives can solve some problems arising from missing and embryonic market institutions. We argue that the co-operative is a good example, how an agricultural co-operative can achieve some of the potential advantages, solving many “traditional” TCE and agency problems and serving its members with a continuing growth.

The Importance and Role of Trust in Agricultural Co-operation – Some Empirical Experiences from Hungary

This paper examines the relations of trust in agricultural cooperation from two aspects. On the one hand, it gives a short review of relevant literature, with special regard to agri-food economy. On the other hand, it uses the results of empirical survey for the analysis of trust in machinery sharing arrangements of Hungarian agricultural producers. In connection with this, the trust is examined in two dimensions: contractual and competence trust. Our results prove that there is a positive correlation between the level of trust and the farmers’ activity in cooperative agreements. It could also be proved that the trust need is very different in the different fields of cooperation. It is a tendency that the contractual trust is more important in more intensive, higher-dependence cooperation activities, while competence trust becomes into the foreground in the more extensive solutions.Agribusiness,

The Choice of Marketing Cooperative in a Transition Agriculture

The agriculture in transition countries can be described by considerable uncertainties. In these countries public institutions are ineffective in ensuring contract enforcement. The absence of enforceable contract to set up any kind of vertical co-ordination has become difficult. In addition, this creates severe barriers for price discovery involving high transaction costs to co-ordinate market exchanges. Although there is a wealth of literature on marketing cooperative, but research on their role in transition agriculture is scarce. This paper tries to contribute to this gap. In this paper we have analysed the potential benefits and costs of the marketing cooperatives in Hungary employing transaction cost economics framework. The results presented add to a small literature on the marketing cooperatives in transition agriculture. We found that the quantity, the existence of contract, flexibility and trust are the most important factor for farmers to selling their product via cooperative. The cluster analysis provides some additional insights regarding farmers' choices. Namely, direct benefits including price, input finance extension services and speed of payments from cooperative membership have also important role. The most striking result is that the diversification and reputation has positive influences on the share of cooperative. Furthermore, large farmers have less willingness to sell their product to the cooperative. Surprisingly, asset specificity has rather negative effects on the share of cooperative.Agribusiness,

Price transmission in the Hungarian vegetable sector

In this paper we analyse price transmission for the carrot, parsley, tomato, green pepper and potato markets. Although there is a dual farm structure dominated by small individual farms, our results imply that price information flows from the producer to the retail level for potatoes, parsley and carrots. Our results also suggest that farmers do not merely accept prices, but can actually influence market prices. Tomato and green pepper prices have large transmission elasticities, and causality runs from the retail to producer level. It therefore follows that tomato and green pepper producers tend to accept prices and that the sector’s prices are determined by upper market levels (processors, wholesalers, retailers). These results are reinforced by the fact that vegetable producers sell a large share of their production through procurement and processing, and therefore are more dependent on the upstream industries, and thus cannot influence prices. For all vegetables in this study the short-run price transmission is symmetric while on the tomato market the long-run price transmission is asymmetric. Results indicate that the tomato market is not competitive and efficient; therefore processors, wholesalers, and retailers are capable of exercising market power, and can instantly transmit producer price increases while just slowly and partially transmitting producer price decreases.Hungarian vegetable sector, producer prices, price transmission, Demand and Price Analysis, Crop Production/Industries,

Farm Inputs and Agri-Environment Measures as Indicators of Agri-Environment Quality in Hungary

The paper deals with agri-environmental indicators, examines farm inputs, on the basis of statistical data of the Organisation for Economic Co-operation and Development (OECD) (Szabo, Pomazi 2002) and the Eurostat (2004). The examined indicators are placed in the agricultural DPSIR model. The paper presents how the use of farm inputs changed in Hungary from 1980-2000. Farm inputs are related to the inputs of the EU-15, the study demonstrates that today they are below the EU- 15 average. Area under agri-environmental measures in 2003 - which covered the 4% of agricultural area of Hungary - as a response indicator is also presented and based in the land-use zone system developed by Godollo Agricultural University (Angyan et al., 1998).agri-environmental measures, farm inputs, indicators, Environmental Economics and Policy, Q01,

THE IMPACT OF TRUST ON COOPERATIVE MEMBERSHIP PERFORMANCE AND SATISFACTION IN THE HUNGARIAN HORTICULTURE

The paper investigates the impacts of trust on the relationships among members and between members and the management in an agricultural marketing cooperative in the Hungarian horticultural sector. We focus on the effects of trust on cooperative members performance and satisfaction and their commitment to remaining a part of cooperative. We analyse the trust along two dimensions: cognitive and affective. Our results suggest that trust among cooperative members and trust between cooperative and management have positive effects on group cohesions. In line with a priori hypotheses we found differences between cognitive and affective trust influencing the group cohesion and cooperative members satisfaction.trust, marketing cooperative, Hungary, Farm Management, Marketing,