Template-Type: ReDIF-Paper 1.0
Author-Name: Feng, L.
Author-Name-Last: Feng
Author-Name-First: Li
Author-Name: Hendrikse, G.W.J.
Author-Name-Last: Hendrikse
Author-Name-First: George
Title: Chain Interdependencies, Measurement Problems, and Efficient Governance Structure: Cooperatives versus Publicly Listed Firms
Abstract: We determine the circumstances when the absence of public listing, often believed to be a disadvantage, makes a cooperative the unique efficient governance structure. This is established in a multi-task principal-agent model, capturing that cooperatives are not publicly listed and their CEOs have to bring the downstream enterprise to value as well as to serve upstream member interests. Not having a public listing prevents the CEO from choosing the level of the downstream activities too high. Cooperatives are uniquely efficient when the upstream marginal product multiplied with a function increasing in the strength of the chain complementarities is higher than the downstream marginal product.
Creation-Date: 2011-01-17
File-URL: https://repub.eur.nl/pub/22720/ERS-2011-001-ORG.pdf
File-Format: application/pdf
Series: RePEc:ems:eureri
Number: ERS-2011-001-ORG
Classification-JEL: M, M13, O32
Keywords: chains, cooperatives, governance, measurement
Handle: RePEc:ems:eureri:22720