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Journal of Agricultural & Food Industrial Organization

Ed. by Azzam, Azzeddine


CiteScore 2018: 0.57

SCImago Journal Rank (SJR) 2018: 0.324
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1542-0485
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Farm Gate Prices for Non-Varietal Wine in Argentina: A Multilevel Comparison of the Prices Paid by Cooperatives and Investor-Oriented Firms

Agustina Malvido Perez Carletti
  • Corresponding author
  • Humboldt Universität zu Berlin, Faculty of Life Sciences, Berlin, Germany
  • Instituto Nacional de Tecnología Agropecuaria, Buenos Aires, Argentina
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  • Other articles by this author:
  • De Gruyter OnlineGoogle Scholar
/ Markus Hanisch / Jens Rommel / Murray Fulton
  • University of Saskatchewan, Johnson-Shoyama Graduate School of Public Policy, Saskatoon, Canada
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Published Online: 2017-09-01 | DOI: https://doi.org/10.1515/jafio-2016-0036

Abstract

In this paper, we use a unique data set of the prices paid to farmers in Argentina for grapes to examine the prices paid by non-varietal wine processing cooperatives and investor-oriented firms (IOFs). Motivated by contrasting theoretical predictions of cooperative price effects generated by the yardstick of competition and property rights theories, we apply a multilevel regression model to identify price differences at the transaction level and the departmental level. On average, farmers selling to cooperatives receive a 3.4 % lower price than farmers selling to IOFs. However, we find cooperatives pay approximately 2.4 % more in departments where cooperatives have larger market shares. We suggest that the inability of cooperatives to pay a price equal to or greater than the one paid by IOFs can be explained by the market structure for non-varietal wine in Argentina. Specifically, there is evidence that cooperative members differ from other farmers in terms of size, assets and the cost of accessing the market. We conclude that the analysis of cooperative pricing cannot solely focus on the price differential between cooperatives and IOFs, but instead must consider other factors that are important to the members.

Keywords: competitive yardstick; pricing policies; non-varietal wine; Mendoza; Argentina

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Published Online: 2017-09-01


Citation Information: Journal of Agricultural & Food Industrial Organization, Volume 16, Issue 1, 20160036, ISSN (Online) 1542-0485, DOI: https://doi.org/10.1515/jafio-2016-0036.

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