The Bargaining Power of Farms in Food Chains
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Publication date: 2012-02-29
GNPJE 2012;253(1-2):135–153
The article reviews the theoretical arguments and conclusions of empirical studies on the bargaining power of farms in contemporary food chains. Theoretical inspirations are mainly drawn from the new political economy and new institutional economics. The author puts forward a thesis that the bargaining power of farms depends on both their resources (economic power) and the possibilities for influencing decision makers (political power). The following market factors influencing the bargaining power of farms are analyzed: market structure, the level of economic resources held, transaction costs, and the scope of cooperation. In addition, political factors are identified: the distribution of voter preferences in society and the influence of agricultural organizations, which are important interest groups. The author attempts to bring order to the definitions and methodological approaches used in the analysis of bargaining power. The article identifies areas for further research with a special emphasis on research into the political power of food chain players and on the need to combine this power with economic power.