VERTICALLY ALIGNED VS. OPEN MARKET COORDINATION: DOMINANCE OR CO-EXISTENCE?

Paul Preckel (), Michael Boehlje, Allan Gray () and Sounghun Kim

No 20099, 2004 Annual meeting, August 1-4, Denver, CO from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: Will a more tightly aligned system become the exclusive coordination or governance system in the pork industry? The analysis shows that the packer prefers to source hogs from both an aligned market and an independent market. This result is because the packer, facing variability in the demand for premium pork, must balance the cost of higher quality aligned hogs and independent hogs against the states of nature for demand for the premium product.

Keywords: Industrial Organization; Livestock Production/Industries (search for similar items in EconPapers)
Pages: 18
Date: 2004
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea04:20099

DOI: 10.22004/ag.econ.20099

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