How can cooperatives reduce democratic costs without incurring excessive agency costs?
Agricultural cooperatives are often assumed to be less competitive compared to investor-owned firms due to its higher decision-making costs. We have empirically investigated how cooperatives can minimize both democratic and agency costs given differing levels of member participation. We distinguish...
Saved in:
Published in | Journal of rural cooperation Vol. 40; no. 2; pp. 119 - 144 |
---|---|
Main Authors | , , |
Format | Journal Article |
Language | English |
Published |
01.10.2012
|
Subjects | |
Online Access | Get full text |
Cover
Loading…
Abstract | Agricultural cooperatives are often assumed to be less competitive compared to investor-owned firms due to its higher decision-making costs. We have empirically investigated how cooperatives can minimize both democratic and agency costs given differing levels of member participation. We distinguish between horizontal, vertical, and diagonal conflicts of interests, as well as between both direct and opportunity costs. We found that direct agency cost is a smaller concern for cooperatives compared to the risk of exposure to high opportunity agency costs. We also found that the relation between member participation in the board of directors and democratic costs is more complex than often assumed. Finally, we show the difficulties cooperatives face in minimizing both democratic and agency costs. With a lower level of member participation, direct democratic costs may be reduced, but opportunity agency costs may rise as fewer members monitor management. Therefore, cooperatives should either increase member participation or use additional agency mechanisms (such as audits) to prevent agency problems. |
---|---|
AbstractList | Agricultural cooperatives are often assumed to be less competitive compared to investor-owned firms due to its higher decision-making costs. We have empirically investigated how cooperatives can minimize both democratic and agency costs given differing levels of member participation. We distinguish between horizontal, vertical, and diagonal conflicts of interests, as well as between both direct and opportunity costs. We found that direct agency cost is a smaller concern for cooperatives compared to the risk of exposure to high opportunity agency costs. We also found that the relation between member participation in the board of directors and democratic costs is more complex than often assumed. Finally, we show the difficulties cooperatives face in minimizing both democratic and agency costs. With a lower level of member participation, direct democratic costs may be reduced, but opportunity agency costs may rise as fewer members monitor management. Therefore, cooperatives should either increase member participation or use additional agency mechanisms (such as audits) to prevent agency problems. |
Author | Pozzobon, Daniela M Zylbersztajn, Decio Bijman, Jos |
Author_xml | – sequence: 1 givenname: Daniela surname: Pozzobon middlename: M fullname: Pozzobon, Daniela M – sequence: 2 givenname: Decio surname: Zylbersztajn fullname: Zylbersztajn, Decio – sequence: 3 givenname: Jos surname: Bijman fullname: Bijman, Jos |
BookMark | eNotjrFOwzAQhj0UibbwDh5ZItm1Y8csCFVAkSqxVKzWxbkWo9QOdkLo25OqnT7p7r7_vwWZhRhwRuZMaF1oWbFbssj5m7HSSCnn5HMTR-ogUBdjhwl6_4uZJmwGh7TBY3TnmZvWuc909P1XHHrqgxtS8uFA8c9hzpNE4YDBnS6HT3fkZg9txvsrl2T3-rJbb4rtx9v7-nlbdJXkhTKay7JidcNEhbCHptJGKVeD1qYRSskVm7DnfMUBhBMgFOpKNcAVw8qIJXm8xI7n9ukfDDZAcj7bCN62vk6QTnYckg3tGd1QZyuFkJpP8sNF7lL8GTD39uizw7aFgHHIlkujTMlLLcQ_QpdmVQ |
ContentType | Journal Article |
Copyright | Wageningen University & Research |
Copyright_xml | – notice: Wageningen University & Research |
DBID | 8BJ FQK JBE QVL |
DatabaseName | International Bibliography of the Social Sciences (IBSS) International Bibliography of the Social Sciences International Bibliography of the Social Sciences NARCIS:Publications |
DatabaseTitle | International Bibliography of the Social Sciences (IBSS) |
DatabaseTitleList | International Bibliography of the Social Sciences (IBSS) |
DeliveryMethod | fulltext_linktorsrc |
Discipline | Economics |
EndPage | 144 |
ExternalDocumentID | oai_library_wur_nl_wurpubs_433471 |
GroupedDBID | 3R3 8BJ 9LF ABDBF ABTAH ALMA_UNASSIGNED_HOLDINGS EOJEC ESX FQK JAG JBE OBODZ OK1 ZY4 ~8M 63O ABPTK H~9 QVL ULY VH1 |
ID | FETCH-LOGICAL-p841-69714580bd038eafad87966cba779d366420d36f1121aa3c3a36e786da160e893 |
ISSN | 0377-7480 |
IngestDate | Tue Jan 05 18:19:21 EST 2021 Fri Aug 16 06:04:51 EDT 2024 |
IsPeerReviewed | true |
IsScholarly | true |
Issue | 2 |
Language | English |
LinkModel | OpenURL |
MergedId | FETCHMERGED-LOGICAL-p841-69714580bd038eafad87966cba779d366420d36f1121aa3c3a36e786da160e893 |
Notes | ObjectType-Article-2 SourceType-Scholarly Journals-1 ObjectType-Feature-1 content type line 23 |
PQID | 1496951573 |
PQPubID | 23473 |
PageCount | 26 |
ParticipantIDs | wageningen_narcis_oai_library_wur_nl_wurpubs_433471 proquest_miscellaneous_1496951573 |
ProviderPackageCode | QVL |
PublicationCentury | 2000 |
PublicationDate | 20121001 |
PublicationDateYYYYMMDD | 2012-10-01 |
PublicationDate_xml | – month: 10 year: 2012 text: 20121001 day: 01 |
PublicationDecade | 2010 |
PublicationTitle | Journal of rural cooperation |
PublicationYear | 2012 |
SSID | ssj0059444 |
Score | 1.8607509 |
Snippet | Agricultural cooperatives are often assumed to be less competitive compared to investor-owned firms due to its higher decision-making costs. We have... |
SourceID | wageningen proquest |
SourceType | Open Access Repository Aggregation Database |
StartPage | 119 |
SubjectTerms | Agency Agricultural co-operatives Bedrijfskunde Business Management & Organization Competitiveness Cost analysis Cost minimization Democracy Leerstoelgroep Bedrijfskunde Management Studies Ownership Structural analysis WASS |
Title | How can cooperatives reduce democratic costs without incurring excessive agency costs? |
URI | https://search.proquest.com/docview/1496951573 http://www.narcis.nl/publication/RecordID/oai:library.wur.nl:wurpubs%2F433471 |
Volume | 40 |
hasFullText | 1 |
inHoldings | 1 |
isFullTextHit | |
isPrint | |
link | http://utb.summon.serialssolutions.com/2.0.0/link/0/eLvHCXMwnZ3NT9swGMYtKIdxmYBtouNDRuI2ZYrrxE6ObQEhpE0cioR2iWzHnoZGgppWQP96XsdO0qIhGJekSpO08s96_frjeYzQMVc5Y2pggoSIOIhYbAIpSBKogUwhYiqmiBUK__jJzq-ii-v4uttHr1aXzOR3tfinruQ9VOEacLUq2f8g274ULsBn4AtHIAzHNzG2-8HZKDYuyzvtLLyt7CMHXBBIbks1rf1Yx2XlVWx2ETJEBDvsV_z-dvpgNQJ26dDQKTDrG19IV6e1P4dqfqmbvb8sF4tSusn7dvnwr0frnVUtZuJm9YvRnxs_5nqxPOBABu3StVZoxbm1IA2Xg6jzXPKVZdA1Ls2E-rM2Z8Xd2o9XZffzaVb8tSeoilUWURpZd4B1SuIe2hiOTkZnTSMbp1HknMH8f1npIGzeQywuanHaUrIw2UIffbHhoUO2jdZ0sYM-NCLw6hO6AnQY0OFldNihwx06XBPBHh1u0eEWHXbo3I2f0eTsdDI-D_wOF8FdEpGApZxEcRLKPKSJFkbkCYfup5KC8zSnDPqGIZwM5MRECKqooEzzhOWCsFBDpvkF9Yqy0LsIKx1LmmqjuYCnciNTnYcmMdRYvyUh-uioKZ8MAoidFRKFLucV9P1SBml2zGkf0a7gssLuZVVlrwL6-q6n9tBmV7f2UW82nesDSO9m8tCjfgL73GF8 |
link.rule.ids | 230,315,786,790,891 |
linkProvider | EBSCOhost |
openUrl | ctx_ver=Z39.88-2004&ctx_enc=info%3Aofi%2Fenc%3AUTF-8&rfr_id=info%3Asid%2Fsummon.serialssolutions.com&rft_val_fmt=info%3Aofi%2Ffmt%3Akev%3Amtx%3Ajournal&rft.genre=article&rft.atitle=How+can+Cooperatives+Reduce+Democratic+Costs+without+Incurring+Excessive+Agency+Costs&rft.jtitle=Journal+of+rural+cooperation&rft.au=Pozzobon%2C+D&rft.au=Zylbersztajn%2C+D&rft.au=Bijman%2C+J&rft.date=2012-10-01&rft.issn=0377-7480&rft.volume=40&rft.issue=2&rft.externalDBID=n%2Fa&rft.externalDocID=oai_library_wur_nl_wurpubs_433471 |
thumbnail_l | http://covers-cdn.summon.serialssolutions.com/index.aspx?isbn=/lc.gif&issn=0377-7480&client=summon |
thumbnail_m | http://covers-cdn.summon.serialssolutions.com/index.aspx?isbn=/mc.gif&issn=0377-7480&client=summon |
thumbnail_s | http://covers-cdn.summon.serialssolutions.com/index.aspx?isbn=/sc.gif&issn=0377-7480&client=summon |