Consumer Cooperatives: Blessing or Curse?

Research output: Chapter in Book/Report/Conference proceedingConference contributionAcademicpeer-review

Abstract

In this paper, I study under which conditions consumer cooperatives are beneficial to consumers where both producers and consumer cooperatives have market power. I establish, contrary to a first intuition, that consumer welfare is non-monotonic in the cooperative size--specifically, consumer welfare first increases and then decreases with the cooperative size. This is because a larger cooperative size may lead to underproduction, and hence may be harmful to consumers. I then show that more intense competition among producers can be more effective in promoting consumer welfare than consumer cooperatives.
Original languageEnglish
Title of host publicationProduction and Operations Management Society Conference
Publication statusPublished - 30 May 2018
Externally publishedYes

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