Value added and governance structure: Evidence from the pear industry in China’s Zhejiang province

Abstract

Traditional farmer cooperatives, new generation farmer cooperatives, and investor-owned firms (IOFs), are compared regarding their value added and value added rate in terms of product marketing. The results of the analysis regarding the pear supply chain in Zhejiang province in China indicate that IOFs obtain a higher value added or value added rate than farmer cooperatives. New generation cooperatives mitigate the under-investment problem of traditional cooperatives in a certain extent. However, farmer cooperatives have some advantages over investor-owned firms in benefiting farmers.