Testing for the Presence of Financial Constraints in US Agricultural Cooperatives: An Investment Behaviour Approach

Abstract

This study examines the presence of financial constraints in US agricultural cooperatives. We test the cooperative capital constraint hypothesis with a panel data econometric analysis of agricultural cooperatives' investment behaviour. Regression results suggest that agricultural cooperatives' capital expenditures are significantly affected by the availability of internal funds. Results also indicate that the sensitivity of investment to cash flow is correlated with cooperative structural characteristics.

Impact of Agricultural Cooperatives on Smallholders’ Technical Efficiency: Evidence from Ethiopia

“…In particular, agricultural cooperatives in the United States and Western Europe have played an important economic role in providing competitive returns for independent farmers (Chaddad et al, 2005). Agricultural cooperatives in those countries were established as service providers and were primarily aimed at countervailing the market power of producers' trading partners, preservation of market options and reduction of risk through pooling.…”

The co-operative model as a ‘living experiment in democracy’

“…As an alternate paradigm to the dominant capitalist economic model, the workers' cooperative has been the subject of criticism by a plethora of scholars from fields such as economics, political science, law, and international development (Ben-Ner, 1984;Chaddad, Cook, & Heckelei, 2005;Hansmann, 1990;Miyazaki, 1984;Vanek, 1977;Varman & Chakrabarti, 2004). These critiques can be separated into those that identify inherent supposed flaws in the cooperative model that prevent its success and those that 1 Here community resilience is defined as ''a community's ability to maintain, renew, or reorganize social system functions and ecological functions; it is a measure of the robustness and buffering capacity of a community in a changing system'' (Varghese et al, 2006).…”

Agricultural Cooperative Firms: Budgetary Adjustments and Analysis of Credit Access Applying Scoring Systems

“…Food and Agriculture Organization of the United Nations FAO shows that for the World Food Day 2012, about 1 billion people are members of cooperatives, cooperatives create 100 million jobs in the world and 45% of the world's agricultural production is owed to the activity of cooperatives. In developing countries, cooperation is of great importance because it allows the limitations imposed by the difficulty of capital accumulation to be overcome (Cotteril, 1987;Fulton et al, 1995;Chaddad et al, 2005;Mishra et al, 2009). In fact, in a cooperative, individual members can contribute, even with small amounts of money, to finance the activities in terms of loans or equity, overcoming the problem of the accumulation of capital owned by a few entrepreneurs as in a limited company.…”