nep-net New Economics Papers
on Network Economics
Issue of 2011‒03‒05
six papers chosen by
Yi-Nung Yang
Chung Yuan Christian University

  1. Myopic or Farsighted? An Experiment on Network Formation By Marco Mantovani; Georg Kirchsteiger; Ana Mauleon; Vincent Vannetelbosch
  2. Managing Network Goals: The Interplay of Network and Firm Levels By Ziggers, Gerrit Willem; Gagalyuk, Taras; Hanf, Jon
  3. Expectations, Experiences, Trust in the Case of Short Circuit Food Supply Networks By Martino, Gaetano; Fritz, Melanie
  4. From Contracts to Networks: New Directions in the Study of Governance of AgroâFoodâEnergy Networks By Zylbersztajn, Decio
  5. Governance Structure, Perception and Innovation in Credence Food Transactions: The Role of Community Networks By Pascucci, Stefano
  6. Evaluation of policy measures for agri-food networks in Italian rural development programmes By Ventura, Flaminia; Diotalllevi, Francesco; Ricciardulli, Nicolletta; Berletti, Maria

  1. By: Marco Mantovani; Georg Kirchsteiger; Ana Mauleon; Vincent Vannetelbosch
    Abstract: Pairwise stability (Jackson and Wolinsky, 1996) is the standard stability concept in network formation. It assumes myopic behavior of the agents in the sense that they do not forecast how others might react to their actions. Assuming that agents are farsighted, related stability concepts have been proposed. We design a simple network formation experiment to test these theories. Our results provide support for farsighted stability and strongly reject the idea of myopic behavior.
    Keywords: Network fomation; Experiment; Myopic and farsighted stability
    JEL: D85 C91 C92
    Date: 2011–02
  2. By: Ziggers, Gerrit Willem; Gagalyuk, Taras; Hanf, Jon
    Abstract: This article provides several contributions to the general understanding of governance in networks and the achievement of private and common goals. A simple, integrated framework for understanding why firms collaborate and under which conditions they establish durable networks that succeed in achieving goals is provided. Network theory is extended by explicitly distinguishing between dyadicâlevel governance and networkâlevel governance conditions, and by identifying exchange conditions that promote governance.This way issues as how networks evolve, how they are governed, and ultimately, how collective outcomes might be generated can be better comprehended. This is especially relevant to policy planners and those having a perspective that goes beyond the performance of individual organizations
    Keywords: Agribusiness, Farm Management, Food Consumption/Nutrition/Food Safety, Industrial Organization, Production Economics, Research Methods/ Statistical Methods,
    Date: 2010–10
  3. By: Martino, Gaetano; Fritz, Melanie
    Abstract: Farmers Markets are receiving an increasing attention by both food chains actors and social scientists. Economic and sociological studies are contributing to the comprehension of these forms of exchange. Both consumers and producers are fostering their expectations about the renewal of a mode of exchange which sustained local productionâ consumptions linkages. The main economic function of these organizational structures seems to be the reduction of the price paid by the consumers and the enhancements of allocation of farm products. The basic interpretation of these forms of exchange focuses on market structure, nonetheless the exchange relationships seems to emphasize several dimensions, including economic and cultural aspects. The objective of the paper is of investigating the role of networks among producers and consumers in structuring and making viable the Farmer Markets as structures of short food supply chains. The basic idea is that the strength of Farmer Markets is the ability of satisfying the consumers expectations about a few characteristics of the products, entailing given cultural and economic aspects. The study argues that under this view the Farmer Markets may be thought of as a emerging form of productionâconsumption interaction. According to existing evidences it is suggested that the network is also the emerging forms of horizontal relationships among the producers participants to the markets. The paper aims at suggesting that basic types of trust act as key factor in structuring the networks and in promoting the stability of the market.
    Keywords: Farmers Markets, networks, trust, food chains sustainability, Agribusiness, Agricultural and Food Policy, Farm Management, Food Consumption/Nutrition/Food Safety, D4,
    Date: 2010–10
  4. By: Zylbersztajn, Decio
    Abstract: The debate about the governance of complex systems of production represents a rich branch of the literature of applied organization theory. The particular application to agroârelated networks is a relevant example since agriculture plays new roles in modern society. The core of the analysis is centered in the rationale for allocation of residual decision rights and distribution of the rights regarding the value created. Contributions based in transaction cost economics, resourceâbased view, dynamic competences, and incomplete contract theory explore different dimensions related to the allocation of property rights. The question of how joint strategies are defined, and how value added (or subtracted) is shared among network players is still relevant. Indeed, the questions of how residual decision rights are defined and how residual rewards of resources applied in production are shared are relevant for the modern theory of organizations in general. Most of the traditional literature considers the transaction as the unit of analysis, following the tradition of the alignment hypothesis proposed by Williamson (1996). Hence the literature as developed so far deals with two limitations. First, the dyadic perspective, which narrows a complex and multidimensional task down to two actors, one transaction, and a choice of internal or contractual mechanisms of coordination. Second, the traditional perspective places its attention on the existing value, whether real or potential, that can be revealed by choosing the efficient mechanism of allocation of authority. This is only part of a larger and more complex frame, where value generation becomes a central question.
    Keywords: governance, networks, coordination of production, Agribusiness, Agricultural and Food Policy, Farm Management, Food Consumption/Nutrition/Food Safety, Political Economy, Research Methods/ Statistical Methods,
    Date: 2010–10
  5. By: Pascucci, Stefano
    Abstract: In this paper we use a combination of behavioral and new institutional economic perspectives to look at the transactions of âsustainableâorientedâ foods (e.g. organic food, fair trade, etc.) which often assume the characteristic of credence goods. When credence attributes are involved in the transaction (e.g. safety, fairness, etc.) information asymmetry and uncertainty tend to reduce the likelihood of different parties to enter in the transaction1. Because spot markets are unlikely to be used in this type of transactions, typical solutions are the use of hybrids, vertical integration and public monitoring (Vetter and Karantininis, 2002; Ménard and Valceschini, 2005). Moreover both consumers and producers (e.g. farmers) look at these products from a more utilitarian (cold) then a hedonic (hot) perspective. In this paper we address this issue by analyzing the effect of a ânewâ governance structure (GS) which is emerging in credence food transactions both at local and global level. We define this GS as a community network (CN) in which consumers and producers strongly integrate their goals by organizing a âclubâ.
    Keywords: Agribusiness, Agricultural and Food Policy, Farm Management, Food Consumption/Nutrition/Food Safety, Industrial Organization, Production Economics, Research Methods/ Statistical Methods,
    Date: 2010–10
  6. By: Ventura, Flaminia; Diotalllevi, Francesco; Ricciardulli, Nicolletta; Berletti, Maria
    Abstract: The agri-food sector is characterized by very heterogeneous agreements and formal and informal contracts aimed to create stable relationships among firms. In this scenario, the actors are linked by common interest in creating and distributing added value. In the network, the risk and the responsibilities are shared by the participants and the transaction costs are reduced by the presence of dynamic flows of information and knowledge. Consequently, the creation and development of agri-food networks is a main objective of regional administration in their Rural Development Plans. The article item is the presentation and the discussion of the methodology used for the evaluation of Integrated Measures Project (Progetti Integrati di Filiera, PIF) presented by firm networks and agri-food chains in Veneto. The result are demonstrated extremely interesting about the understanding of PIF. Moreover, the comparative study serve to understand the result in terms of competitive advantage and income for the farmers.
    Keywords: agri-food networking, food-chain policy, Rural Development Programme, Agricultural and Food Policy, Q18,
    Date: 2011–02–10

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