Agricultural cooperatives and quality-enhancing R&D in the agri-food system

This paper develops a game - theoretic model of heterogeneous consumers to analyze the effect of cooperative involvement on quality- enhancing product innovation activity, the pricing of food products, and the welfare of the groups involved in the context of a mixed duopoly where an openmembership consumer co- op competes with an IOF. Analytical results show that the involvement of the member welfare- maximizing co- op in R&D can be quality and welfare enhancing by increasing the arrival rate of product innovations and reducing the prices of food products. The effectiveness of the co- op is shown to depend on the nature of product differentiation and the relative quality of its products, the degree of consumer heterogeneity, and the size of innovation costs .


Issue Date:
2006
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/10075
Total Pages:
36
Series Statement:
Seminar Paper




 Record created 2017-04-01, last modified 2017-08-23

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