[Journal:] Journal of Entrepreneurial and Organizational Diversity [ISSN:] 2281-8642 [Volume:] 2 [Issue:] 1 [Publisher:] European Research Institute on Cooperative and Social Enterprises (EURICSE) [Place:] Trento [Year:] 2013 [Pages:] 23-36
European Research Institute on Cooperative and Social Enterprises (EURICSE), Trento
The economic nature of agricultural cooperatives is explained by means of a logical continuation of the organizational economics rationale for family farms. The traditional explanations of the importance of family farms is discussed, and embedded in a broader framework which considers their transaction cost-economizing effect and their limitations in terms of limited ability to scale up production and to reach adequate market power. We maintain that these disadvantages represent the major motives for the creation of agricultural cooperatives, whose role lies in enabling the realization of advantages of large scale organization in agriculture while avoiding its transaction costs.
agricultural cooperatives irreducible transaction costs reducible transaction costs new generation cooperatives structural change property rights