AN INSTITUTIONAL ANALYSIS OF VERTICAL COORDINATION VERSES VERTICAL INTEGRATION: THE CASE OF THE US BROILER INDUSTRY

Patricia Aust

No 11670, Staff Paper Series from Michigan State University, Department of Agricultural, Food, and Resource Economics

Abstract: This paper analyzes the situation, structure and performance of broiler production. The inherent interdependence in broiler production is high transactions costs. Two types of transactions costs, asset specificity with uncertainty and high information costs, are identified and explored. The performances of the alternative structures, vertical integration and vertical coordination, are outlined. In broiler production, vertical coordination is preferred by both firms and growers because it minimizes transactions costs. These conclusions are extended to other agricultural commodities, using pork and rice as examples.

Keywords: Livestock; Production/Industries (search for similar items in EconPapers)
Pages: 13
Date: 1997
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:midasp:11670

DOI: 10.22004/ag.econ.11670

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