Journal article

Chain Failure Theory as a Framework for Evaluating Horizontal and Vertical Strategic Alliances Among Food Value Chain Participants: A Red Meat Industry Perspective

Bill Malcolm, G Griffith, S Mounter, E Fleming

Australian Farm Business Management Journal | AFBM Network | Published : 2017


Useful insights about the operations of value chains can be gained by considering them as “latent clubs”, that is, systems having the potential for improvement through collective action. Club theory therefore can be applied to examine ways to increase the economic surplus of a food value chain by participants taking collective action within a club good framework. The results of such action are called “chain goods”. If these types of goods are not supplied along the value chain, value chain partners cannot maximise whole-of-chain profit. The result is “chain failure”; a concept analogous to the market failure of public goods in the wider economy. If an opportunity exists for partners in a val..

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