Distinguishing dairy cooperatives from investor-owned firms in Europe using financial indicators.

The European dairy industry is facing a number of challenges related to policy changes and global trends that add pressure on their economic performance. This study uses logistic regression to analyze differences in financial and performance indicators between European dairy cooperatives and investor-owned firms. The investigated indicators are profitability, debt, operational efficiency, equity growth, size, and country dummies. The empirical application uses data from 170 European dairy firms. Cooperatives are on average less profitable, operate more efficiently, and have a stronger financial position than investor-owned firms. Using the above-mentioned financial and performance indicators, cooperatives appear to be well equipped to cope with the challenges ahead. [EconLit citations: Q13; M12; C25]. © 2010 Wiley Periodicals, Inc. [ABSTRACT FROM AUTHOR]