University of Wisconsin Center for Cooperatives
Journal of Agricultural Cooperation

Title Pool Payment Equity in Agricultural Marketing Cooperatives
Author(s) Steven T. Buccola, James C. Cornelius, and Ron R. Meyersick
Series Volume 4
Issue Date 1989
Abstract Marketing cooperatives often commingle farm products in a common payment pool. A member's receipts from a pool depend upon the method the cooperative uses for valuing raw product patronage. The present article examines alternative patronage valuation methods with particular regard to their effect on the distribution of pool income. Principles of distributive equity are discussed and conditions shown under which a valuation rule would be equitable in the senses defined. The discussion is illustrated with a pool consisting of snap beans and sweet corn. It is shown that valuation rules differ in the mean and variance of subsidies that they induce across products.

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