Critical Issues for Ag Co-ops

As an economic downturn affects many aspects of the economy and government operations, there is increased interest in exploring the potential of alternative economic enterprises or service delivery systems. Increased incidences of market failures are occurring as the required conditions for successful markets are being tested. Markets function best with: limited barriers to entry, an adequate number of well-informed buyers and sellers, and no excessive market power by any buyer or seller.

A number of conditions for a perfect market are being challenged in today’s world of giant global companies, too big to fail firms, and unbalanced access to market knowledge or information. Remedies to market failure can include: the removal of barriers to entry, price levels that encourage more competition, increased government oversight, or group action such as forming cooperatives to market or purchase products or services. Mutual, self-help strategies become more attractive in an era of downsizing government and shrinking public support for delivering a range of services, particularly for certain demographic groups or geographic areas where markets tend to fail more often, including: low-income populations, rural locations with sparse populations, poor physical infrastructure, or areas with limited access to market information.

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As an economic downturn affects many aspects of the economy and government operations, there is increased interest in exploring the potential of alternative economic enterprises or service delivery systems. Increased incidences of market failures are occurring as the required conditions for successful markets are being tested. Markets function best with: limited barriers to entry, an adequate number of well-informed buyers and sellers, and no excessive market power by any buyer or seller A number of conditions for a perfect market are being challenged in today’s world of giant global companies, too big to fail firms, and unbalanced access to market knowledge or information. Remedies to market failure can include: the removal of barriers to entry, price levels that encourage more competition, increased government oversight, or group action such as forming cooperatives to market or purchase products or services. Mutual, self-help strategies become more attractive in an era of downsizing government and shrinking public support for delivering a range of services, particularly for certain demographic groups or geographic areas where markets tend to fail more often, including: low-income populations, rural locations with sparse populations, poor physical infrastructure, or areas with limited access to market information. - See more at: http://www.choicesmagazine.org/choices-magazine/theme-articles/critical-issues-for-agricultural-cooperatives/new-cooperative-development-issues#sthash.TBZrEZJ8.dpuf