Agricultural Cooperatives and Contract Price Competitiveness
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This study examines the price competitiveness of marketing and production
contracts depending on whether contracts are with cooperatives or investorowned
firms. A propensity score matching method is used to compare prices
using contract data from a national farm-level survey. The results show that
prices of agricultural contracts with cooperatives are not significantly different
from those with investor-owned firms, which indicates that cooperatives are
adhering to recommended business practices of offering market prices to their
members.