Research Handbook on Sustainable Co-operative Enterprise
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Research Handbook on Sustainable Co-operative Enterprise

Case Studies of Organisational Resilience in the Co-operative Business Model

Edited by Tim Mazzarol, Sophie Reboud, Elena Mamouni Limnios and Delwyn Clark

Co-operatives are found in all industry sectors and almost all countries around the world. However, despite their significant economic and social contributions, the academic literature has largely ignored these important businesses. This book is a detailed examination of the co-operative enterprise business model and the factors that help to enhance its sustainability and resilience, as well as those forces that lead to its destruction.
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Chapter 6: Responding to the external environment: the evolution of Brazilian dairy co-operatives

Fabio R. Chaddad


There is a long debate in the literature regarding the economic role of farmer-owned cooperatives in the agrifood sector. On one hand, some scholars argue that co-operatives will have declining importance as the agrifood sector becomes increasingly industrialized and global (e.g., Helmberger 1966; Boehlje 1997; Caves and Petersen 1986; Holmstrom 1999). On the other hand, others speculate that co-operatives may increase their participation in the agrifood sector to ameliorate market failures, reduce transaction costs, and also to add value to producers' incomes (e.g., Abrahamsen 1966; Sexton 1986; Royer 1995; Rogers 1997). In general, agricultural co-operatives play an increasingly important economic role in advanced agricultural countries such as the United States (Cook 1995) and Western Europe (Van Dijk et al. 1997; Hendrikse 2007). Particularly in the dairy industry, farmer-owned co-operatives play a rather dominant role with market shares above 80% in milk collection in the US, the major dairy countries in Western Europe and also in Australia and New Zealand (Chaddad 2007). Throughout the twentieth century farmer-owned co-operatives played an increasingly important role in the Brazilian dairy sector. By the end of the 1980s, tier-one, local dairy co-operatives were collecting about 70% of the total milk produced in the country.

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