Hrabrin Bachev
Unprecedented development in theory of economic organisations in past decades has brought about to significant evolution in understanding of essence and efficiency of agri-business organizations. Nevertheless traditional approach for assessing management and efficiency of economic organisationsis (“black-box” approach, through “technical or financial efficiency” of production factors, “productivity of employed resources”) is widly used. Concequently it cannot be excplained: why there are so many organizations performing with great variation in efficiency for long period of time. This paper incorporates achievements of interdisciplinary New Institutional Economics and suggests a framework for assessing management and efficiency of organizations for agri-biusiness and innovation. According to this new approach we have to study firm and farm as a governing rather than as production structure; assess comparative efficiency of alternative market, contract, internal, and hybrid modes of governance; take into account transaction costs and institutional, behavioral, dimensional, technological and natural factors; enrich (reformulate) criteria of economic efficiency of business organization; and better determine effective horizontal and vertical boundaries of business organisations. Specificity in the area of agri-business research and innovations is also clarified. Effective boundaries of different governing modes are assessed, and needs and forms for public intervention in agrarian research and innovation are clarified.
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