Work

Reducing Hold-up Risks in Ethanol Supply Chains: A Transaction Cost Perspective

Year: 2014

Type: article

Abstract: Ethanol plants sit at the intersection of three main supply chains, involving the procurement of feedstocks and the marketing of ethanol and distillers grains. A transaction cost framework assesses the extent to which uncertainty, asset specificity, and transaction frequency create incentives for opportunistic behavior by exchange partners leading to problems of hold-up. Using case study evidence from the western Canadian ethanol sector, solutions to the hold-up risks facing ethanol plants are explored. Contracting and integration feature strongly in downstream output markets. The positioning of the ethanol enterprise within a firm’s overall business model, whether as a stand-alone investment or as a forward or backward integration strategy, is an important consideration for future supply chain research in this sector.

Source: RePEc: Research Papers in Economics

DOI: 10.22004/ag.econ.167906

Authors: Weseen, Simon, Hobbs, Jill, Kerr, William A.

Institution: University of Saskatchewan

Language: English

Topic: Outsourcing and Supply Chain Management

Subfield: Management Information Systems

Field: Business, Management and Accounting

Domain: Social Sciences

SDGs: Responsible consumption and production, Industry, innovation and infrastructure

Open Access status: gold

Funder: Agriculture and Agri-Food Canada