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Some Cooperatives Produce Great Wines, but the Majority Does Not: Complementary Institutional Mechanisms to Improve the Performance of an Indispensable Organizational Form*

Published online by Cambridge University Press:  11 January 2018

Bernd Frick
Bernd Frick*
Affiliation:
Management Department, University of Paderborn, Warburger Strasse 100, 33098 Paderborn, Germany; e-mail: bernd.frick@uni-paderborn.de; Department of Sport Economics and Sport Marketing, Schloss Seeburg University, Seeburgstrasse 8, 5201 Seekirchen/Salzburg, Austria; e-mail: bernd.frick@uni-seeburg.at.
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Abstract

Although they have often been found to be technically inefficient, cooperatives not only have survived in the wine industry but continue to play major roles in most European countries. Because the specific advantages of their “organizational architecture” (resource pooling and decentralization) seem to outweigh the disadvantages (vaguely defined property rights and high monitoring costs), this paper discusses organizational measures to improve the performance of cooperatives by addressing three different aspects of “organizational design” (managing entry and exit, motivating members, and investing in corporate culture). (JEL Classifications: D22, D23, L14, L21, L31)

Keywords

adverse selectionfirm performancemoral hazardorganizational designorganizational form
Type
Articles
Information
Journal of Wine Economics , Volume 12 , Issue 4 , November 2017 , pp. 386 - 394
Copyright
Copyright © American Association of Wine Economists 2018 

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Footnotes

*

I would like to express my sincere thanks to the organizers—Günter Schamel and Karl Storchmann—of the AAWE workshop “Economics of Organization and Integration in the Wine Sector” on June 26 and 27, 2017, at the Free University of Bolzano (Italy) for their hospitality and the participants as well as a referee for their constructive comments and suggestions that helped improve the paper. Errors and omissions are, of course, my own.

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