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Themselves, regarding the other vegetables. The desirability of this arrangement is not clear (Dixit 1997, 2002). Another illustration is a feature of cooperatives known as the portfolio problem. An important consideration of members in the diversification decision of a cooperative may be spreading of risks of their individual farm portfolio, which may result in members “. . ” (Cook 1995: 1157). 8 We agree with Sexton (1984: 429) when he writes ‘Labor-managed firms are closely analogous to agricultural marketing cooperatives.

Associations can represent their members in relations with institutions cooperating with farmers and negotiate prices or contracts with purchasers or sellers on behalf of the farmers. This form can be established very easily and has a simple structure. Its biggest disadvantage, however, is its inability to cumulate profits and share capital among members; members are not owners of the accumulated capital (Lemanowicz, 2005: 103). Twenty-three percent of the groups adopted the legal form of a union and the same portion chose a Limited Liability Company (LLC).

Barton, D. (1989). What is a cooperative? In D. Cobia (Eds), Cooperatives in Agriculture. Prentice Hall, Englewoof Cliffs, 1–20. Bonus, H. (1986). The co-operative association as a business enterprise: A study of the economics of transactions. Journal of Institutional and Theoretical Economics, 142(2), 310–339. Brickley, J. A. (1999). Incentive conflicts and contractual restraints: evidence from franchising. Journal of Law and Economics, 745–774. CEC-Commission of the European Communities (2001).

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