Spot market versus incentive contract

  1. Fernández-Olmos, M. 1
  2. Marín Vinuesa, L.M. 2
  1. 1 Universidad de Zaragoza
    info

    Universidad de Zaragoza

    Zaragoza, España

    ROR https://ror.org/012a91z28

  2. 2 Universidad de La Rioja
    info

    Universidad de La Rioja

    Logroño, España

    ROR https://ror.org/0553yr311

Zeitschrift:
New Medit

ISSN: 1594-5685

Datum der Publikation: 2009

Ausgabe: 8

Nummer: 3

Seiten: 12-20

Art: Artikel

SCOPUS: 2-s2.0-80052232931 WoS: WOS:000271273000003 GOOGLE SCHOLAR

Andere Publikationen in: New Medit

Institutionelles Repository: lock_openOpen Access Editor

Zusammenfassung

This paper attempts to develop a consistent theory for the choice of performance contracts in agriculture by analyzing the trade-off between quantity and quality and the presence of competence and uncertainty on the basis of the expected utility theory. This theory is able to explain many contract-related issues, such as why the performance contract can be optimal even providing lesser quantity and quality than the spot market and why a trade-off between processorś and consumeŕ interests about mechanism choice can exist, utilizing a simulation exercise.