Vertical integration in West Africa's cotton industry: are parastatals a second best solution?
研究比较了西非棉花产业中纵向一体化的国有公司与竞争性市场结构的效果，发现存在要素市场约束和资本市场失灵时，高效运营的国有公司通过提供投入信贷能提升部门福利和效率，但竞争市场需要配套发展信贷和研究推广机构。
Abstract This article provides a framework to compare market outcomes among vertically integrated monopsonies in the cotton sector of West Africa and alternative, more competitive market structures. Based on a principal agent framework, in the presence of factor market constraints, as well as capital market failure, efficiently operated cotton parastatals increase sector welfare and efficiency by providing input credits. In equilibrium, outcomes with the principal agent model suggest growers receive the reservation income to participate in cotton production while the principal (cotton company) extracts the surplus above the reservation income. Competitive markets entail more equitable distribution of benefits than with parastatal vertical integration, but credit and factor market constraints can still persist. Promotion of a competitive market system will not support cotton productivity growth unless stakeholders pursue complementary programs to develop credit markets and research and extension institutions. In the presence of current market failures, parastatals may be a second‐best solution.