Exploring variability across cooperatives: economic performance of agricultural cooperatives in northern Ethiopia

The number of agricultural cooperatives increased quickly in Ethiopia since the 1990s. While many papers studied the impact of membership of Ethiopian cooperatives, not much is known on their performance. This study takes a cooperative-level perspective which is unique in an African context. It compares the economic performance proxied by sales revenue and profit of a wide range of agricultural cooperatives in northern Ethiopia. Data were collected from 511 agricultural cooperatives in 12 districts of Tigray. The contributing factors of the performance are analyzed with Ordinary Least Squares regression (OLS) and Heckman selection models. Our results underscore the importance of membership size, total assets, presence of conflict among members, and union membership. Chairperson characteristics and the internal organization of a cooperative seem to be less correlated to performance.

Automated summary

This study compares the economic performance of 511 agricultural cooperatives in northern Ethiopia and highlights the importance of membership size, total assets, conflict among members, and union membership on performance. Chairperson characteristics and the internal organization of a cooperative seem to have less correlation with performance.