This study examines the motivation behind contracts and vertical integration in the pork industry, and simulates the effects of potential improvements in coordination. Incentives related to lowering costs of measuring and sorting hogs, and protecting against opportunistic behavior associated with specific assets, can result in hog quality improvements. A framework for simulating the effects of increased coordination through contracts and vertical integration was developed and used to evaluate potential improvements in leanness. Although simulations suggest only modest changes in pork prices and supplies, gains in consumers' surplus could be substantial for larger demand shifts due to quality improvements.

This paper examines the relationship between industrialized production in the pork and broiler industries and the natural environment. Historical perspectives are presented regarding the movement toward increasingly concentrated and coordinated pork and broiler production units in the South. The relationships between animal by-product management and environmental quality, both at the farm level and within a geographic region, are addressed. Using the North Carolina pork industry as a background, current regulations and potential policy implications to protect environmental quality are discussed.

This study investigates factors influencing coordination of the California grape and wine supply chain. Results corroborate prior findings that quality considerations and needs to protect investments in specialized or durable assets significantly increase usage of more formal coordination mechanisms, such as formal contracts and vertical integration or ownership. Consistent with findings for other industries, such investments are associated with greater contract complexity and inclusion of enforcement provisions, while trade partners' prior experience working together decreases contract complexity. Furthermore, our results suggest that quality considerations extend to greater use of formal contracts further downstream. (JEL Classifications: L1, L2, Q13)