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Contracts and cooperation: the relative failure of the Irish dairy industry in the late nineteenth century reconsidered

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  • Ingrid Henriksen
  • Eoin McLaughlin
  • Paul Sharp
Abstract
Why did the establishment of cooperative creameries in late nineteenth-century Ireland fail to halt the relative decline of her dairy industry compared with other emerging producers? This paper compares the Irish experience with that of the market leader, Denmark, and shows how each adopted the cooperative organizational form, and highlights that an important difference was institutional: specifically, regarding the enforcement of vertically binding contracts. We argue that this failure, combined with a strong proprietary sector which was opposed to cooperation, reinforced the already difficult conditions for dairying in Ireland due to poor social capital.

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  • Ingrid Henriksen & Eoin McLaughlin & Paul Sharp, 2015. "Contracts and cooperation: the relative failure of the Irish dairy industry in the late nineteenth century reconsidered," European Review of Economic History, European Historical Economics Society, vol. 19(4), pages 412-431.
    • Handle: RePEc:oup:ereveh:v:19:y:2015:i:4:p:412-431.
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    1. Ingrid Henriksen & Eoin McLaughlin & Paul Sharp, 2015. "Contracts and cooperation: the relative failure of the Irish dairy industry in the late nineteenth century reconsidered," European Review of Economic History, European Historical Economics Society, vol. 19(4), pages 412-431.
    2. Henriksen, Ingrid & Hviid, Morten & Sharp, Paul, 2012. "Law and Peace: Contracts and the Success of the Danish Dairy Cooperatives," The Journal of Economic History, Cambridge University Press, vol. 72(1), pages 197-224, March.
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    5. repec:cge:wacage:2016 is not listed on IDEAS
    6. Guinnane, Timothy W. & Martinez-Rodriguez, Susana, 2010. "Did the Cooperative Start Life as a Joint-Stock Company? Business Law and Cooperatives in Spain, 1869-1931," Center Discussion Papers 90880, Yale University, Economic Growth Center.
    7. Eoin McLaughlin & Paul Sharp, 2021. "Competition between organisational forms in Danish and Irish dairying around the turn of the twentieth century," Business History, Taylor & Francis Journals, vol. 63(2), pages 314-341, February.
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    11. Henriksen, Ingrid & Lampe, Markus & Sharp, Paul, 2011. "The role of technology and institutions for growth: Danish creameries in the late nineteenth century," European Review of Economic History, Cambridge University Press, vol. 15(3), pages 475-493, December.
    12. Christopher L. Colvin & Eoin McLaughlin, 2014. "Raiffeisenism abroad: why did German cooperative banking fail in Ireland but prosper in the Netherlands?," Economic History Review, Economic History Society, vol. 67(2), pages 492-516, May.
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    15. Samuel Garrido, 2014. "Plenty of trust, not much cooperation: social capital and collective action in early twentieth century eastern Spain," European Review of Economic History, European Historical Economics Society, vol. 18(4), pages 413-432.
    16. O'Rourke, Kevin H., 2007. "Property rights, politics and innovation: creamery diffusion in pre-1914 Ireland," European Review of Economic History, Cambridge University Press, vol. 11(3), pages 395-417, December.
    17. Joel Sobel, 2002. "Can We Trust Social Capital?," Journal of Economic Literature, American Economic Association, vol. 40(1), pages 139-154, March.
    18. Richard Perren, 1971. "The North American Beef and Cattle Trade with Great Britain, 1870-1914," Economic History Review, Economic History Society, vol. 24(3), pages 430-444, August.
    19. Francisco J. Beltrán Tapia, 2012. "Commons, social capital, and the emergence of agricultural cooperatives in early twentieth century Spain," European Review of Economic History, European Historical Economics Society, vol. 16(4), pages 511-528, November.
    20. KevinH. O'Rourke, 2007. "Culture, Conflict and Cooperation: Irish Dairying Before the Great War," Economic Journal, Royal Economic Society, vol. 117(523), pages 1357-1379, October.
    21. Turner,Michael, 1996. "After the Famine," Cambridge Books, Cambridge University Press, number 9780521553889, September.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Markus Lampe & Paul Sharp, 2017. "ÔRationalÕ Farmers and the Emergence of Modern Accounting in Danish Dairying," Working Papers 0115, European Historical Economics Society (EHES).
    2. Peter Sandholt Jensen & Markus Lampe & Paul Sharp & Christian Volmar Skovsgaard, 2018. "‘Getting to Denmark’: the Role of Elites for Development," Working Papers 0125, European Historical Economics Society (EHES).
    3. Ingrid Henriksen & Eoin McLaughlin & Paul Sharp, 2015. "Contracts and cooperation: the relative failure of the Irish dairy industry in the late nineteenth century reconsidered," European Review of Economic History, European Historical Economics Society, vol. 19(4), pages 412-431.
    4. Sofia Henriques & Eoin McLaughlin & Paul Sharp & Xanthi Tsoukli & Christian Veddel, 2020. "Opening the Black Box of the Danish Dairy Cooperatives: A Productivity Analysis," Working Papers 0203, European Historical Economics Society (EHES).
    5. Bentzen, Jeanet & Boberg-Fazlic, Nina & Sharp, Paul & Skovsgaard, Christian & Vedel, Christian, 2023. "Holy Cows and Spilt Milk: The Impact of Religious Conflict on Firm-Level Productivity," CEPR Discussion Papers 18679, C.E.P.R. Discussion Papers.
    6. Eoin McLaughlin & Paul Sharp, 2021. "Competition between organisational forms in Danish and Irish dairying around the turn of the twentieth century," Business History, Taylor & Francis Journals, vol. 63(2), pages 314-341, February.
    7. Christopher L. Colvin & Stuart Henderson & John D. Turner, 2018. "The Origins of the (Cooperative) Species: Raiffeisen Banking in the Netherlands, 1898–1909," Working Papers 0126, European Historical Economics Society (EHES).
    8. Bengtsson, Erik, 2019. "Reconsidering the Role of Farmer Politics in Swedish Democratization," Lund Papers in Economic History 205, Lund University, Department of Economic History.
    9. Samuel Garrido, 2018. "Why the first cooperative wineries produced poor quality wine, why they were so scarce and why they were set up: evidence from Spain," Documentos de Trabajo (DT-AEHE) 1807, Asociación Española de Historia Económica.
    10. Sharp, Paul & Jensen, Peter & Lampe, Markus & Skovsgaard, Christian, 2018. "‘Getting to Denmark’: the Role of Elites for Development," CEPR Discussion Papers 12679, C.E.P.R. Discussion Papers.
    11. Nina Boberg-Fazlic & Peter Sandholt Jensen & Markus Lampe & Paul Sharp & Christian Volmar Skovsgaard, 2023. "‘Getting to Denmark’: the role of agricultural elites for development," Journal of Economic Growth, Springer, vol. 28(4), pages 525-569, December.
    12. Eoin McLaughlin & Paul Sharp & Xanthi Tsoukli & Christian Vedel, 2021. "Ireland in a Danish mirror: A microlevel comparison of the productivity of Danish and Irish creameries before the First World War," Working Papers 0219, European Historical Economics Society (EHES).

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    More about this item

    JEL classification:

    • K12 - Law and Economics - - Basic Areas of Law - - - Contract Law
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship
    • N43 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: Pre-1913
    • N53 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries - - - Europe: Pre-1913
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

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