Applied Economic Perspectives and Policy · 1999 · 127 citations · 11 references
AgricultureAgricultural EconomicsBusiness EconomicsAgribusiness EconomicsContract TheoryContractsAgribusiness PolicyAgribusiness RegulationAgricultural Commodity PricingAgricultural MarketsFood Industry EconomicsFood Marketing EconomicsAgricultural Input PricingIncentive MechanismsMail SurveysMarket IntermediariesResidual RiskResidual Risk IdentificationResidual Risk Management
Abstract This article examines the structure of contractual relations between growers and first handlers in California fruit and vegetable markets. Evidence on existing structures is collected from on‐site interviews and from a small mail survey of market intermediaries who contract with independent growers. Four generic instruments are identified—input control, field visits, quality measurement, and residual price risk—which are used to coordinate relations between growers and first handlers and which help to alleviate information asymmetries and align incentives between contracting parties. Drawing from our interviews and survey, we offer examples of how each of these instruments are employed.
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Moral Hazard and Observability
Bengt Holmström · The Bell Journal of Economics · 1979 · 8.5K citations
Economics, Organization and Management.
Sudipto Bhattacharya, Paul Milgrom, John W. Roberts · The Journal of Finance · 1993 · 4.8K citations