In this paper, it is demonstrated that partnership arrangements between farmers might be a way to secure the economic viability of their farms as well as to increase profitability. The article discusses empirical analyses of three different forms of collaboration, with an emphasis on the environmental improvements associated with collaboration. Collaboration between a dairy farm and a crop farm is analyzed in the first case. The results show that potential gains from improved diversification and crop rotation are substantial, and even larger when the collaboration also involves machinery. The second analysis considers external integration between farrowing and finishing-pig operations. Gains from collaboration originate from biological and technical factors, such as improved growth rate of the pigs and better utilization of buildings. Finally, an evaluation of a group of collaborating crop farmers is performed. In this case, the benefits that arise are mainly due to reduced machinery costs and/or gains due to other factors, such as improved crop rotation and managerial/marketing strategies.
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