ANALYSIS OF CHANGING METHODS OF VERTICAL COORDINATION IN THE PORK INDUSTRY

This study examines the motivation behind contracts and vertical integration in the pork industry, and simulates the effects of potential improvements in coordination. Incentives related to lowering costs of measuring and sorting hogs, and protecting against opportunistic behavior associated with specific assets, can result in hog quality improvements. A framework for simulating the effects of increased coordination through contracts and vertical integration was developed and used to evaluate potential improvements in leanness. Although simulations suggest only modest changes in pork prices and supplies, gains in consumers' surplus could be substantial for larger demand shifts due to quality improvements.


Issue Date:
1998-12
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/15561
Published in:
Journal of Agricultural and Applied Economics, Volume 30, Number 2
Page range:
301-311
Total Pages:
11




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

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)