Determinants of long-term business relationships in the dairy value chain in transition countries: the case of Albania

Blendi Gërdoçi, Engjell Skreli, Edvin Zhllima, Drini Imami
2017 Studies in Agricultural Economics  
Building on transaction cost economics theoretical framework, we examined the determinants of long-term business relationships between farmers and buyers in the Albanian dairy chain in a context characterised by weak institutions and lack of formal contract. Logistic regression analysis was employed to test the model on primary data collected from a sample of 315 Albanian farmers engaged in the production of sheep and goat milk. The study results support our hypotheses that trust, uncertainty
more » ... d levels are discussed. At a managerial level, dairy owners and managers need to build trust with farmers and mitigate uncertainties as a precondition for long-term relationships. At the policy level, the government subsidy schemes need to be further latter being a precondition also to achieve traceability and improve standards.
doi:10.7896/j.1709 fatcat:cito2j6m3nfhvdghavmrrojobq