GOVERNANCE OF PRODUCTION CO-OPERATIVES IN RUSSIAN AGRICULTURE

Jerker Nilsson, Svetlana Golovina, Sebastian Hess and Axel Wolz

Annals of Public and Cooperative Economics, 2016, vol. 87, issue 4, 541-562

Abstract: Many Soviet kolkhozy and sovkhozy were transformed into agricultural production co-operatives, because the farm workers would have had large transaction costs in any other type of organization. These co-operatives still hold a strong market position. This study explores the hypothesis that this market strength could be due to low governance costs, obtained through strong manager power. As managers want the co-operative to survive, they make limited investments in the co-operative and pay low wages. The members, however, do not consider this to be problematic. They appreciate the community within the village, their private plots of land and the co-operative's services. Hence the existence of the co-operatives is not threatened.

Date: 2016
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