Manitoba producers' willingness-to-invest in New Generation Cooperatives

Abstract

The New Generation Cooperative (NGC) has been a popular form of farmer-owned enterprise widely adopted by producers in the United States, especially in North Dakota and Minnesota. The adoption rate of this organizational form has been comparatively slow in the province of Manitoba, which is geographically adjacent to these two states. The objective of this thesis is to ascertain which factors affect Manitoba producers' willingness-to-invest and willingness-to-commit to NGCs, as well as potential monetary investment in NGCs. Finally, whether or not these decisions are affected by producer farm type is determined. Data collected from surveying Manitoba producers are analyzed using ordered logit to examine the producers' willingness-to-invest and willingness-to-commit, and tobit to examine the producers' potential monetary investment in NGCs. Further statistical analysis is shown through producer profiles, odds ratios and marginal effects. Positive and significant associations are found between a producer's self-assessed knowledge about NGCs, having been approached, farm size, education level and their willingness-to-invest, while there is a negative association with age. Self-assessed knowledge level and contracted commodities have positive and significant associations with willingness-to-commit. Finally, self-assessed knowledge level, having been approached , farm size, net cash income, minimum rate of return required, age, and education level have positive and significant associations with potential monetary investment, while production of commodities under contract and risk-aversion levels have negative associations with potential monetary investment.