Libang Lai, Jiacai Liu and Jie Yang
Farmer-supermarket direct purchase (FSDP) is one of the significant innovative modes in the circulation of agricultural products. The previous studies on the FSDP mode were mainly…
Abstract
Purpose
Farmer-supermarket direct purchase (FSDP) is one of the significant innovative modes in the circulation of agricultural products. The previous studies on the FSDP mode were mainly premised on the assumption of power symmetry among cooperative players. Nevertheless, in reality, power asymmetry often exists among players because of restricted coalitions and diverse input resources. In this research, the influence of power asymmetry on profit distribution among various players in FSDP is explored.
Design/methodology/approach
The power asymmetry within FSDP is explored in two aspects: the distinct status of coalition structure and the varying degrees of dependence among players. Since FSDP is a typical cooperative mode, an average tree solution (abbreviated as “A-T solution”) of a cooperative game with a restricted coalition structure and the tripartite mutual deterrence model with a dependency factor are analyzed. Subsequently, the corresponding profit distribution strategies of FSDP are provided.
Findings
This research demonstrates that the cooperative coalition structure and/or location and the degree of dependence on other players can affect their profit-earning capacity during the FSDP process. Furthermore, the players' ability to distribute profits is negatively associated with the degree of interdependence (dependency factor). It is shown by the fact that cooperatives are at the center of FSDP, as farmers in China are a dispersed and powerless group; in a word, the FSDP supply chain is a restricted coalition structure. Even in an arbitrary coalition structure, farmers still remain in a weak position and lack the power of speech in the distribution of profits. Therefore, enhancing the position of farmers is necessary to stabilize cooperative relationships in supply chains.
Research limitations/implications
These methods have broad potential applications to research power asymmetry in supply chain management. However, it is only applicable in situations where significant information on alliance structure and the dependence degree is available.
Originality/value
This study concentrates on the factors of power asymmetry and investigates the influence of power asymmetry on the profit distribution among players, thereby expanding the depth and width of the research on FSDP. The key contribution of this paper lies in explaining the “unfair” profit distribution scheme in FSDP from coalition cooperative game and bargaining game theory (a mathematical perspective). It provides a decision-making basis for enhancing the overall position of farmers in the agricultural supply chain.
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Nam Hoang Vu, Nguyen Thi Khanh Chi and Hai Hong Nguyen
This study explores the effects of gender and participation in agricultural cooperatives on biodiversity conservation farming practices in vegetable production.
Abstract
Purpose
This study explores the effects of gender and participation in agricultural cooperatives on biodiversity conservation farming practices in vegetable production.
Design/methodology/approach
This study used data collected from a survey of 627 vegetable farmers in Viet Nam and employed the Ordered Probit regression model to examine the effects of gender and participation in agricultural cooperatives on biodiversity conservation farming practices.
Findings
We find that female vegetable farmers are more likely to conduct biodiversity conservation farming practices than male farmers. This gender difference is, however, removed when participation in agricultural cooperatives is controlled, suggesting that agricultural cooperatives effectively facilitate biodiversity conservation farming practices.
Research limitations/implications
It is noted that our study is not free from some limitations. First, we conducted our study on vegetable farmers only. The biodiversity conservation practices in vegetable cultivation might be different from other types of farming. Future studies should be conducted with other types of agricultural cultivation. Second, we do not have enough data to explain why female farmers are more likely to adopt biodiversity conservation practices than male farmers. Future studies should capture biological and social aspects of gender differences to address this limitation.
Originality/value
This study contributes to the literature on biodiversity conservation by presenting empirical evidence on the effects of gender and agricultural cooperatives. Participation in agricultural cooperatives is revealed to facilitate the adoption of biodiversity conservation practices. In addition, we find that the education of farmers, the number of years that farmers have been living in the local area and the quality of land and water are positively related to the adoption of biodiversity conservation practices in vegetable production.
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Chen Ji, Ni Zhuo and Songqing Jin
Farm income in the agricultural sector is susceptible to natural and market risks. A large body of literature has studied the effects of cooperative membership on household…
Abstract
Purpose
Farm income in the agricultural sector is susceptible to natural and market risks. A large body of literature has studied the effects of cooperative membership on household welfare, technical efficiency, productivity and production behavior, yet little has been known about the impact of cooperative membership on farm income volatility. This paper aims to fill this research gap by investigating the relationship between cooperative membership and farm income volatility of Chinese pig farmers and drawing policy implications.
Design/methodology/approach
This paper examines the effect of cooperative membership on farm income volatility, using data from a two-round survey of pig farmers in China. The authors employ an endogenous switching regression model to address the selection bias issues associated with unobserved factors simultaneously affecting farmers' participation in agricultural cooperatives and income earning activities.
Findings
Using household panel from a two-round survey of 193 pig farmers in China, this analysis highlights two key findings: (1) agricultural cooperative membership has significant and positive effect on farm income stability and (2) the impact of cooperative membership on farm income stability varies with production scale.
Originality/value
This research makes two contributions to the literature. First, this study contributes to the scant literature exploring the relationship between agricultural cooperatives and farm income stability. Second, to the best of the authors' knowledge, this is the first study that explores such relationship in a livestock sector. The pig sector in China and around the developing world has been increasingly challenged by multifaceted risks (e.g. price fluctuations, epidemic diseases, environmental regulations), and understanding the role of agricultural cooperatives in farm income stability of pig farmers is of great practical and policy significance.
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Samuel Ahado, Jiří Hejkrlík, Anudari Enkhtur, Tserendavaa Tseren and Tomáš Ratinger
The purpose of this paper is to examine the impact of agricultural cooperative membership on potato production and technical efficiency.
Abstract
Purpose
The purpose of this paper is to examine the impact of agricultural cooperative membership on potato production and technical efficiency.
Design/methodology/approach
A combination of propensity score matching technique and sample selection stochastic frontier framework that addresses potential selection bias due to observable and unobservable attributes is used to estimate the effect of participation between cooperative members and non-members. Using a stochastic meta-frontier approach, the technical efficiency of farmers was estimated and compared.
Findings
The empirical results show that the effect of participation in agricultural cooperatives is associated with increased yield and technical efficiency. A comparison of group-specific frontiers indicates that cooperative members perform better than non-members. Cooperative membership decisions is significantly associated with household and farm characteristics (e.g. education, participation in off-farm work, total farmland, distance to market and geographic location).
Practical implications
The findings of this study demonstrate that cooperative organisations can be an important tool to enhance the productivity and efficiency of smallholder farmers. Successful cooperative models together with training programs designed to enlighten farmers on the importance and tangible benefits of collective action should be used to enlarge participation in cooperative organisations. In addition, governments and development agencies should implement targeted investment and capacity building programs related to irrigation management, gender-sensitive awareness and development of the internal institutional mechanisms in cooperatives for the transfer of knowledge and mutual learning so that all members benefit from cooperatives.
Originality/value
Despite the pervasive evidence of the impact of cooperatives on productivity and technical efficiency in the Asian region, this study is probably the first attempt in the crop sector in Mongolia. It provides a rigorous empirical analysis of the impact of agricultural cooperative membership on potato production and technical efficiency through a counterfactual design.
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During the past four decades, agriculture and rural development in China has scored a great progress. Organization institution in agriculture is one of the domains with drastic…
Abstract
Purpose
During the past four decades, agriculture and rural development in China has scored a great progress. Organization institution in agriculture is one of the domains with drastic innovations. The purpose of this paper is to map the emergence and evolution of various agricultural organizations in China since 1978. Development status and the trend of agricultural organization system are analyzed. Further, the role of farmer cooperatives is discussed.
Design/methodology/approach
Data used in the paper are mainly from statistical yearbooks and documents published by the government including Ministry of Agriculture and Bureau of Industry and Commercial. Both descriptive and deductive analyses are adopted to achieve different analytical purposes.
Findings
The vast small-farm sector, co-existence of various types of organizations, and innovation of other organizations will continue and sustain for a long-time period in China. Despite the fast development of modern farmers and various organizations, it is important that traditional farmers participate effectively in modern agriculture. Farmers act collectively via a cooperative in a desirable way, which determines the central position of farmer cooperatives in the agricultural organization system.
Research limitations/implications
This paper is a qualitative analysis on agricultural organizations in China, yet no quantitative estimation regarding the comparison of various organizations is conducted due to insufficient data.
Originality/value
This paper fills the gap of a comprehensive review of the emergence, development status, and trend of agricultural organizations in China.
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Ying Yang, Mai Ha Pham, Biao Yang, Jun Wei Sun and Phuong Nguyen Thu Tran
While various aspects of the vegetable supply chain (SC) have been increasingly studied, most studies tend to investigate the downstream part of the SC in terms of customer demand…
Abstract
Purpose
While various aspects of the vegetable supply chain (SC) have been increasingly studied, most studies tend to investigate the downstream part of the SC in terms of customer demand and product quality. Relatively fewer studies have focused on upstream suppliers/farmers. This study aims to understand upstream farmers’ positions in different types of vegetable SCs and identify ways of enhancing sustainable vegetable SC collaboration.
Design/methodology/approach
This study is based on an in-depth case study of a cooperative SC in Vietnam from the perspectives of both the cooperative and its farmers.
Findings
The study found that cooperative SCs are the most appropriate for Vietnamese farmers. It also identified the key activities needed to engage farmers with cooperative SCs and the mechanisms that the cooperative needs to develop. Cooperative SCs can be enhanced only when farmers are motivated to engage in SC activities and when the cooperative implements a robust management mechanism.
Originality/value
This study provides new, insightful results on how to engage with small fragmented farmers for SC collaboration and how to enhance the roles of cooperative SCs in the vegetable industry in Vietnam. It also provides information for policymakers to support sustainable vegetable SC development and maintain its sustainability.
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Cinthya Mônica da Silva Zanuzzi, Cristian Rogério Foguesatto, Graciele Tonial, Dieisson Pivoto and Paulo Maurício Selig
Driven by scientific and technological intensification, Brazilian agribusinesses are among the main food producers and exporters worldwide. Knowledge management contributes to the…
Abstract
Purpose
Driven by scientific and technological intensification, Brazilian agribusinesses are among the main food producers and exporters worldwide. Knowledge management contributes to the development of agribusinesses. The objective of this study is to analyze knowledge management practices in the supply chain of broilers at the level of farmers and compare the differences between farmers who are members of cooperatives, and those who are suppliers of firms.
Design/methodology/approach
Using data from a sample of broiler farmers (n = 240, where 80 respondents are associated with cooperatives) from Brazil, descriptive statistics were used to measure the four knowledge management dimensions (leadership, people, process and technology). The Mann–Whitney test was performed to verify the difference in the adoption of knowledge management practices between farmers who are members of cooperatives, and those who are suppliers of firms.
Findings
The results showed significant differences between the analyzed groups of broiler farmers that are members of an agricultural cooperative and suppliers of firms. Farmers who supply firms adopt knowledge management practices with greater intensity. They are also more technified and have a larger scale of production.
Research limitations/implications
The study was conducted in a single agribusiness chain. Future studies may look at another method of knowledge management assessment to see if the results will be similar.
Practical implications
The results can contribute to the development of programs and policies, incorporating knowledge management into agribusiness as a competitive strategy.
Originality/value
While knowledge management is a widely studied topic, there has been little focus on this subject with regard to agribusiness. Empirical findings of an important agribusiness supply chain are provided and show the differences in knowledge management perceptions between farmers who are members of cooperatives and those who are suppliers of firms.
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Andrew Gerard, Maria Claudia Lopez, Daniel C. Clay and David L. Ortega
This study aims to improve our understanding of side selling in farmer cooperatives. Cooperative member side selling, in which farmers divert produce from cooperatives to…
Abstract
Purpose
This study aims to improve our understanding of side selling in farmer cooperatives. Cooperative member side selling, in which farmers divert produce from cooperatives to competitors, threatens coffee cooperatives. This is a problem in Burundi, where many households earn income from coffee and cooperatives serve a collective action function.
Design/methodology/approach
Using data from a survey of Burundian coffee farmers, we assess the determinants of two types of cooperative member side-selling behavior: selling to both cooperative and non-cooperative buyers and selling solely to non-cooperative buyers.
Findings
Farmers who sell to both cooperative and non-cooperative buyers are more likely to be male household heads, be more invested in coffee and have larger farms than non-side sellers, among other characteristics. Farmers who only sell to non-cooperative buyers are poorer and less invested in coffee than non-side sellers.
Research limitations/implications
Additional research is needed to better understand why side-selling behavior differs between groups and to better understand how household head gender influences side selling. In addition, this study lacks qualitative data supporting quantitative findings. Future research should include qualitative methods to better understand motivations for side-selling behavior.
Originality/value
The study provides important information on what influences cooperative member side selling and focuses on specific types of side-selling behavior that have been largely overlooked. The study focuses on the role of household head gender in side selling, which is important, given the centrality of women to African agriculture.
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The purpose of this paper is to investigate risks faced by farmer cooperatives in China, using farmer cooperatives in Zhejiang province as a case. Specifically, the authors…
Abstract
Purpose
The purpose of this paper is to investigate risks faced by farmer cooperatives in China, using farmer cooperatives in Zhejiang province as a case. Specifically, the authors identify risks inherent in two primary types of farmer cooperatives in China (traditional and modern ones) when the external environment changes, the cooperative size expands and heterogeneity in membership widens.
Design/methodology/approach
The authors assume that the “uncertainty of the external environment” and the “deviation of organisational adaptation” constitute the two dynamic factors that generated risks for farmer cooperatives. A survey of 158 farmer cooperatives is obtained in Zhejiang province in 2010, and factor analysis is employed to identify the risks and their critical degrees of traditional and modern cooperatives.
Findings
The results indicate that two types of cooperatives in China face drastically different sets of risks. Traditional cooperatives face larger competitive and human resources risks, whereas modern cooperatives face larger decision-making and behavioural risks. Product market risk, macroeconomic policy risk and financial risk are common critical risks faced by both types of cooperatives.
Originality/value
In this paper, risks in China's farmer cooperatives were empirically studied and systematically discussed. The paper offers a typology to identify risks inherent in two primary types of farmer cooperatives in China (traditional and modern ones) according to property rights arrangements and governance structure.
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Gerald Mashange and Brian C. Briggeman
The purpose of this paper is to examine the financial condition and ability of farmer cooperatives to withstand significant increases in bad debt expense.
Abstract
Purpose
The purpose of this paper is to examine the financial condition and ability of farmer cooperatives to withstand significant increases in bad debt expense.
Design/methodology/approach
A unique data set of farmer cooperative financial statements that spans from 1996 to 2019 is used to examine the changes in profitability, solvency, liquidity and accounts receivable risk. Also, a deterministic stress test model is designed to shock bad debt expense and the resulting write-off of accounts receivable for farmer cooperatives. The stress test provides insights to the resiliency of farmer cooperatives.
Findings
Results find that farmer cooperatives are in a strong financial position, which has improved over time. The majority of farmer cooperatives are able to absorb a substantial increase in bad debt expense because of their sizable, retained earnings position. However, cooperatives that have significant profitability challenges do experience much larger losses, especially mixed farmer cooperatives (roughly equally amounts of grain and farm supply sales) and large cooperatives with more than $500 million in sales.
Practical implications
The stress test results suggest farmer cooperative managers and boards of directors could re-examine their credit policies and consider extending additional credit. Also, cooperatives should consider monitoring and identifying an optimal accounts receivable to retained earnings ratio, which is similar to how banks examine their tier 1 capital ratios.
Originality/value
The value of this study is having data that allows for the examination of the financial condition of farmer cooperatives over time. Also, having current data means the accounts receivable stress test results are more relevant and timelier. This is important because these accounts receivable are primarily tied to crop input supplies, and farmer cooperatives are a significant market participant in the crop input supply market.