Guaranteeing a Market and the Contracts of Bargaining Cooperatives

Charles R. Knoeber and David L. Baumer

Journal of Agricultural Cooperation, 1986, vol. 01, 9

Abstract: One important function of bargaining cooperatives is alleged to be guaranteeing a market for their members. We characterize this function as deterring opportunistic behavior by producers and processors operating under forward contracts. We then examine actual contracts of bargaining cooperatives and argue that certain clauses in these contracts serve to guarantee the market. These clauses are those that provide for mechanical or third-party grading, liquidated damages, and most-favored-customer treatment.

Keywords: Agribusiness (search for similar items in EconPapers)
Date: 1986
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Persistent link: https://EconPapers.repec.org/RePEc:ags:joagco:46268

DOI: 10.22004/ag.econ.46268

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