Contract Farming Resource Centre

Contracting in agriculture empirical evidence from barley production in Ukraine

Year 2006

This paper investigates the issue of economic interaction between the participants of the contract. A typical principal-agent problem, reflected in controversial goals on the way of fulfillment of the common task, is considered on the example of malt-producing company and farms-suppliers of barley. The aim is to find crucial determinants of the quality of agents� performance, measured as a yield of barley, and to test whether contract relations lead to the increased performance