The significance of the interconnection of second-level cooperatives and their peer-associated cooperatives for productivity growth

Abstract

Cooperatives are especially important in current agri-food markets. These companies have responded to the current demand requirements with greater market orientation strategies to attract and satisfy customers. To do so, cooperatives have adopted different collaboration alternatives. In Spain, the most common alliance between cooperatives is materialised in second-level cooperatives, which are cooperatives integrated by at least two first-level cooperatives. The aim of this study was to analyse the interaction effects between first-and second level agri-food cooperatives on their productive growth and its components. To get this purpose, a CobbDouglas specification with spatial econometrics techniques was applied to evaluate this relationship. We included a spatial connectivity matrix to establish the interconnection among cooperatives of first-and second-level. Our results show a positive interaction effect highlighting the importance of these alliances on the productivity growth in the agri-food sector. The scarce amount of empirical papers explaining how second-level cooperatives influence the performance of first-level cooperatives shows the relevance of our study.Additional key words: Malmquist productivity index; spatial econometric modelling; spatial interaction effects.Correspondence should be addressed to María Martínez-Victoria: mdc.mvictoria@gmail.com

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