Abstract
The paper aims to investigate Thorstein Veblen’s evolutionary framework to the analysis of agribusiness systems. Veblen’s theory argues that institutions are as much the result of individual choices as act over choices through the enforcement of mental habits. So there is a recursive relationship between individuals and institutions. Veblen’s stressed out contributions: (i) a broad concept of institution, and (ii) institutional recursive relationships, both are of great value for the investigation of agribusiness systems. The article provides an assessment of Monsanto’s role in the Brazilian market of genetically modified seeds (GM). In accordance with the performed assessment Monsanto may be considered as an institution in that market, because its performance enforces and establishes routines and habits among market players, like the examples of the scheme to collection of royalties fees at soybean trading facilities, and the role of Monsanto in the enactment of the Brazilian GMO property rights regime.
Highlights
The paper aims to apply the theoretical contributions of Veblen‟s evolutionary approach to empirical investigations related to the analysis of agribusiness systems
Institutional Economics is a branch of thinking that has its starting point from the assumption that economic behavior is conditioned by the social environment that surrounds transactions
That enforcement was possible by the role Monsanto features in the genetically modified seeds (GM) seed agribusiness system over farmers, input firms, and seed multipliers firms to whom it maintains commercial interactions
Summary
The paper aims to apply the theoretical contributions of Veblen‟s evolutionary approach to empirical investigations related to the analysis of agribusiness systems. Arrangements like vertical integration, outsourcing, forward and futures contracting are examples of the coordinating role of leader firms (Zylbersztajn, 2005) As those arrangements are implemented, they tend to became routine practices followed by players in the agribusiness system, not as a result of rational deliberation, based on economic efficiency. The paper provides an assessment of Veblen‟s evolutionary framework for the analysis of agribusiness systems by the use of Monsanto‟s institutional role in the Brazilian GM seeds market. The research made use of Monsanto‟s case study to illustrate Veblen‟s contributions to the understanding of organizations as institutions, and the endogenous process of the formation of habits and routines Both provide theoretical constructs that are of key importance for understanding the institutional change in agribusiness systems
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