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001-es BibID:BIBFORM005402
Első szerző:Szabó G. Gábor (közgazdász, MTA Közgazdaságtudományi Intézet)
Cím:Theoretical and practical approaches towards coordination and integration mechanisms : The case of the Hungarian dairy sector / Gábor G. Szabó, Péter Popovics
Dátum:2008
Megjegyzések:Independent privately owned farm organisations can not countervail the market power of their business partners. Accordingly, coordination seems an appropriate solution as it tries to solve the most critical problem: the great deficiency in pursuing the interest of producers in the chain. Just before Hungary's EU accession (2004), the dairy sector was one of the most critical industries of the Hungarian agriculture, which is why we chose this for our empirical analysis. Results of our price transmission analysis as well as our previous study on contractual relations in the Hungarian dairy sector obviously show that only the increase of input prices will increase the prices in the production-processing stage. Hence, the farm gate price is determined by the costs, not by the market situation. Farmers cannot enforce their interest separately and act against the concentrated processing industry. High investment costs, expensive functional machinery, the long production cycle from the time of investment, the continuous production and the perishable dairy products are all significant risk factors and deepen the vulnerable situation of farmers. The different coordination mechanisms (including producers' groups, co-operatives etc.) are able to improve and strengthen the position of farmers in the price negotiations for a fairer selling price and for eliminating the fluctuations of the price. Furthermore, some positive effects might go beyond the industry and concern the whole society. As a main body of our study we summarize the strengths, weaknesses, opportunities and threats of the different coordination structures in the frame of a SWOT analysis, assuming two theoretical situations: one is when the coordination is initiated by the processor or when it is initiated by the farmer. As a theoretical background we use New Institutional Economics featuring Transaction Cost Economics considerations. Analysing the statements defined in both SWOT analyses, we find that depending on the initiator of the coordination, there are significant differences between the strengths, weaknesses, opportunities and threats. There are common points, since transaction costs decrease and production is more cost effective in both cases. However, some factors occur as a strength in one system and as a weakness in the other, for e.g. quality. We cannot decide which organization is more beneficial, since the factors listed might include many subjective factors that makes the judgement more difficult, furthermore, the development, fulfilment and emphasizing of the specific points might cause significant differences even for two similar organizations. However, we can claim that in any organization the key points of the successful coordination are financial power, quality consciousness, and professional management, and these factors are included as strengths in the processor-initiated coordination. At the end of our paper we present a successful organisation the Alföldi Milk Selling and Supplying Ltd. which is a good example for the vertical integration based on the horizontal coordination of farmers as initiators. The Ltd. is an independent group of farmers, of which members co-operated not for production but for selling and marketing in order to establish market power against the monopolistic processors and retailers in the region, and to ensure the benefits of the members. The existence, development and the efficient production of the business conducted by the producer owned organisation proves that by co-operation of farmers there is a chance and opportunity to significantly improve their countervailing power and to establish ownership for farmers in the processing stage of the Hungarian dairy chain.
Tárgyszavak:Társadalomtudományok Gazdálkodás- és szervezéstudományok tanulmány, értekezés
dairy sector
price transmission analysis
contracts
contractual relations
SWOT analysis governance structure
vertical co-ordination
agribusiness
producers' group
Transaction Cost Economics, Hungary
Megjelenés:The Role of Agricultural Cooperatives. - p. 1-17.
További szerzők:Popovics Péter András (1978-) (agrárközgazdász)
Internet cím:elektronikus változat
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