Organization and governance in the agrifood sector: How can we capture their variety?

Abstract

The variety of solutions to organize economic activities is striking, and underexplored. This paper proposes a framework that combines transaction cost and relational contracts models to capture this variety while characterizing some representative forms. The framework distinguishes between organizational structures differing according to the intensity of control exercised over the rights to use resources, and the modalities of governance through which these structures operate. The combination of these two dimensions provides tools for understanding the existence, characteristics, and conditions under which some organizational arrangements tend to prevail. Based on these premises, the paper proposes an analysis that goes beyond the dichotomy between “markets” and “hierarchies.” This framework is inclusive of those hybrids arrangements that play such an important role in the agrifood industry and it explores two modalities that are particularly challenging to standard theories: cooperatives and plural forms. [EconLit citations: D 230; L 0; Q 100].