Improving Our Understanding of the Conduct and Performance of Cooperative Businesses Using Directed Acyclic Graphs

A great deal of effort is devoted to the exploration of agribusiness firm behavior through survey instruments. Mainly in an attempt to understand the needs and desires of firms, such studies can improve the information available to marketers and other decision makers within an industry. The implications drawn from these studies might elicit discussions on “best practices” employed by successful firms. The data involved are typically a mixture of qualitative and quantitative variables and, not surprisingly, empirical analyses can give mixed results that are open to interpretation. A better understanding of the relationship among variables might improve structural analysis, however business theory is often vague in that regard. To help, we suggest the use of a less known methodology in the analysis of survey data, namely, the directed acyclic graph (DAG). We demonstrate its potential with an analysis of agricultural cooperative firms.