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Prof. Carlo Russo

Contact information:

Term: First Semester

Credits (ECTS): 6

Prerequisites: Knowledge of basics of economics

Language of instruction: English

Class hours: 42


Cognitive / Knowledge skills

  • Understanding and explain of the basic functioning of the Agri-Food Value Chains;
  • Understand and explain the key mechanism of price determination in the Agri-Food Value Chains;
  • Understand and explain the role of food quality as competitive advantage and its impact on competition;
  • Understand and explain the key drives of vertical coordination in the Agri-Food Value Chains.
  • Understand and explain the importance of asymmetric information in the Agri-Food Value Chains

Analytical / Critical Thinking Skills (Oral & Written)

  • Use Industrial Organization tools for the analysis of Agri-Food Value Chains
  • Analyze the structure of Agri-Food Industries, identify the key competitive strategies of Agri-Food Firms
  • Solve governance design problems



Agri-Food Value Chains are complex organizations. Modern food systems involve a large numbers of firms: farmers, processors, input providers, life science companies, logistic firms, retailers, market analysts, finance services and many others. The main topic of this class is the analysis of the market mechanisms ensuring coordination among such diverse firms. The focus is the concept of Governance, which is the set of rules, regulations and private arrangements presiding over the interaction among firms in the Agri-Food Value Chains. Efficient Governance ensures that independent firms act coordinately to produce consumer’s (and shareholders’) value.

The course discusses four key issues in the Governance of Agri-Food Value Chains: price determination, quality, information and contracts. For each topic, lectures discuss the implications for the Governance, including the problems of coordination design, strategic interaction and coordination.



The class will meet for 2 hours (gross of interclass break), twice a week, for a total of 21 sessions in 11 weeks. After an introduction aimed at providing the needed background, participants are required to read the materials related to the class and to be prepared prior to coming to class. Classes will consist of a lecture by the instructor, to be followed by a discussion of the main topics and the assigned case. Main points about the materials and all doubts brought up by the students will be addressed by the instructor during the class.



Lecture 1: Introduction: The European Agri-Food Value Chain

           Readings: EU Agricultural Outlook; Ellickson 2015

Lecture 2: Value in modern food systems (Part I)

            Readings: Gwin & Gwin 2003

Lecture 3: Value in modern food systems (Part II)

            Readings: Gwin and Gwin 2003

Lecture 4: Value and time-saving services

            Readings: Chiappori & Lewbel 2015; Heckman 2015

Lecture 5: Price determination: coordination and welfare distribution (Part I: perfect competition)

            Readings: Gardner 1975

Lecture 6: Price determination: coordination and welfare distribution (Part II: Market Power)

            Readings: Sexton & Zhang 2001

Lecture 7: Price determination: coordination and welfare distribution (Part III: Market Power)

            Readings: Sexton & Zhang 2001

Lecture 8: Recap Session

Lecture 9: Midterm

Lecture 10: Quality and competition: Vertical quality

            Readings: Tirole (2008). Industrial Organization. Pages 296-298 only

Lecture 11: Quality and competition: Horizontal quality and assortment

            Readings: Lancaster 1990; Office of Fair Trading 2014 Pages 21-26 only

Lecture 12: Quality and asymmetric information (Part I)

            Readings: USDA 2000

Lecture 13: Contracts

            Readings: Peterson, Wysocki & Harsh 2001; Bogetoft, & Olesen 2002

Lecture 14: Principal-agent model: the Landowner problem (Part I)

            Readings: Stiglitz 1974

Lecture 15: Principal-agent model: the Landowner problem (Part II)

            Readings: Stiglitz 1974

Lecture 16: Modern retailers’ supply chains (Part I: Bargaining power and contracts)

            Readings: European Parliament (2016). Structural change in EU farming. Part III only

Lecture 17: Modern retailers’ supply chains (Part II: Trade spending and unfair trade practices)

            Readings: Bloom, Gundlach & Cannon 2000

Lecture 18: Recap Session



All students are expected to spend at least 2,5 hours of time on academic studies outside of, and in addition to, each hour of class time. Students not attending lectures are expected to spend, on average, at least 7 hours of individual studies for each lecture (2 hours lectures).



The instructor will use numerous and differentiated forms of assessment to calculate the final grade you receive for this course. For the record, these are listed and weighted below. The content, criteria and specific requirements for each assessment category will be explained in greater detail in class. Any questions about the requirements should be discussed directly with your faculty well in advance of the due date for each assignment.

Each student can freely choose one of the two assessment options:

Option A:


Option B:






Final exam (oral)


Class participation




Midterm (written)




Final exam (oral)




Class Participation:  This grade will be calculated to reflect your participation in class discussions, your capacity to introduce ideas and thoughts dealing with the texts, your ability use language effectively, and to present your analysis in intellectual, constructive argumentation.

Mid Term Exam: The midterm is designed to establish and communicate to you the progress you are making towards meeting the course learning objectives. Your abilities will be tested in two important areas of competency: the amount of information you master and the accuracy of the information you present.

Structure: Three open questions asking students to: i) explain a key concept in the syllabus, ii) apply the notions to a specific problem, iii) proof a given statement (any combination of the three type of questions is possible). Prior to the examinations, a comprehensive review will be given during class.

Final Exam The final exam is an oral examination through which the instructor will assess the significance you ascribe to the facts and ideas you have integrated across your study in this course.



Professionalism and communications: As a student, you are expected to maintain a professional, respectful and conscientious manner in the classroom with your instructors and fellow peers.
You are expected to take your academic work seriously and engage actively in your classes. Advance preparation, completing your assignments, showing a focused and respectful attitude is expected of all students. Simply showing up for class or meeting minimum outlined criteria will not earn you a good grade in this course. Utilizing communications, properly addressing your faculty and staff, asking questions and expressing your views respectfully demonstrate your professionalism and cultural sensitivity.

Attendance and Classroom behavior: Although attendance is not compulsory, it is highly recommended. All students must have a respectful attitude towards the professor as well as the classmates.

Arriving late / departing early from Class: Once they have decided to attend, students must behave consistently. Arriving late or leaving class early is disruptive and shows a lack of respect for instructor and fellow students.

Make-up classes: The instructor reserves the right to schedule make-up classes in the event of an unforeseen or unavoidable schedule change. Make-up classes may be scheduled outside of typical class hours, as necessary.

Missing Examinations: Examinations will not be rescheduled. Pre-arranged travel or anticipated absence does not constitute an emergency and requests for missing or rescheduling exams will not be granted.

Use of Cell Phones, Laptops and Other Electronic Devices: Always check with your instructor about acceptable usage of electronic devices in class. Inappropriate usage of your electronic devices will result in a warning and may lead to a deduction in participation grades. Use of a cell phone for phone calls, text messages, emails, or any other purposes during class is impolite, inappropriate and prohibited. Faculty determines whether laptops will be allowed in class. The use of a laptop, tablets or of cell phones is prohibited during all tests and exams, unless otherwise specified by your instructor. 



Listed below are the required readings. These are required materials for the course and you are expected to have constant access to them from the very beginning of the course for reading, highlighting and note-taking. It is required that you have unrestricted access to each. Access to additional sources required for certain class sessions may be provided in paper or electronic format consistent with applicable copyright legislation. All readings are available on the course page on Google classroom or upon request.

Required readings:

- EU Agricultural outlook 2015-2015. European commission (available at )

- Ellickson (2015): The evolution of the supermarket industry: form A&P to Walmart

- Gwin, C. F., & Gwin, C. R. (2003). Product attributes model: A tool for evaluating brand positioning. Journal of Marketing Theory and practice, 11(2), 30-42.

- Chiappori, P. A., & Lewbel, A. (2015). Gary Becker's a theory of the allocation of time. The Economic Journal, 125(583), 410-442.

- Heckman, J. J. (2015). Introduction to a Theory of the Allocation of Time by Gary Becker. The Economic Journal, 125(583), 403-409.

- Gardner, B. L. (1975). The farm-retail price spread in a competitive food industry. American Journal of Agricultural Economics, 57(3), 399-409.

- Sexton, R. J., & Zhang, M. (2001). An assessment of the impact of food industry market power on US consumers. Agribusiness, 17(1), 59-79.

- Lancaster, K. (1990). The economics of product variety: A survey. Marketing science, 9(3), 189-206.

- Tirole (2008). Industrial Organization. Pages 296-298 only

- Office of Fair Trading (2014). Competing on quality –Lit review. Pages 21-26 only

- Peterson, H. C., Wysocki, A., & Harsh, S. B. (2001). Strategic choice along the vertical coordination continuum. The International Food and Agribusiness Management Review, 4(2), 149-166.

- Bogetoft, P., & Olesen, H. B. (2002). Ten rules of thumb in contract design: lessons from Danish agriculture. European Review of Agricultural Economics, 29(2), 185-204.

- Stiglitz, J. E. (1974). Incentives and risk sharing in sharecropping. The Review of Economic Studies, 41(2), 219-255.

- Bloom, P. N., Gundlach, G. T., & Cannon, J. P. (2000). Slotting allowances and fees: Schools of thought and the views of practicing managers. Journal of Marketing, 64(2), 92-108.

- European Parliament (2016). Structural change in EU farming. Part III only

Suggested readings will be selected and provided throughout the semester, depending on students’ interest.



[Ultima modifica: martedì 19 gennaio 2021]