Essays on Cooperatives: Emergence, Retained Earnings, and Market Shares

Cooperatives received significant attention in recent years as an alternative to investor-owned corporations. The objective of a cooperative to advance the interests of its member-owners is appealing from a societal perspective, particularly when comparing it with a profit-maximizing objective of an investor-owned firm.
This thesis focuses on agricultural cooperatives, i.e. on the enterprises collectively owned by farmer-members. It advances the knowledge about a cooperative enterprise in three ways:
(i) by conceptualizing and evaluating different patterns of emergence of cooperatives;
(ii) by delineating an efficient allocation of decision rights regarding the profit distribution in cooperatives, from a relational contracting perspective;
(iii) and by investigating the determinants of cooperative market shares in the EU.

Chapter 1 discusses the distinguishing features of this governance form. First, the owners of a cooperative are also users, because farmers deliver their farm products to the cooperative enterprise. Second, the allocation of ownership implies that residual income and decision rights are allocated to the farmers in a cooperative.
Chapter 2 models cooperative emergence as a non-cooperative game between two farmers and an outsider.
Chapter 3 formulates a non-cooperative game between the upstream party (farmers) and the downstream party (cooperative management) regarding the distribution of profits of the cooperative enterprise.
Chapter 4 provides an empirical analysis of cooperative market shares in the European Union.
Lastly, Chapter 5 concludes and addresses how the results can be extended beyond agricultural cooperatives.