Farmer Cooperative Theory: Recent Developments

Since 1980, agricultural economists have begun to reexamine fundamental issues in the theory of agricultural cooperation. These include the basic nature of farmer cooperation; the theoretical benefits and limits of cooperative enterprise; and the implications of these for cooperative members, managers, and public policy. Analysts have extended previous models of the cooperative as a type of business firm in order to analyze the impact of large cooperatives on market performance. They have also developed new models to analyze how cooperatives attempt to serve the divergent interests of different participants, such as managers and different classes of farmers. This report describes and evaluates recent theoretical developments, outlines remaining areas of conflict and gaps in the theory of agricultural cooperation, and discusses topics for future research. It concludes that one of the most promising areas for current research may be in testing hypothesis arising from current theoretical work