There are three types of farmer organizations in Taiwan: farmer associations (FAs), agricultural production and marketing groups (APMGs), and agricultural cooperatives (Coops), which is different from most of the countries in the world. Due to the differences in hierarchy, managerial and operating aims and goals, and member compositions among the three, the effects of farmer organization participation may also vary. This study utilizes the Primary Farmer Household Survey (PFHS) conducted in 2013 by the Taiwanese government. The empirical research estimates the determining factors and the average treatment effects of farmer organization participation based on a multinomial sample selection model. The factors influential to the participation behavior and the choice of joining a certain type of farmer organization are annual working days on own-held farm, production scale (measured by in-household labor and cultivate land area), prior work experience, and main conducting types (husbandry or agriculture) or crop types. The economic impacts of participation are also confirmed. The results show that, after controlling for the social-economic variables affecting farmer households’ profit and the endogeneity arising from self-selection, farm households participating in APMGs or Coops reveal better economic performance than those joining FAs or non-participants. The participation in APMGs brings an average treatment effect of agricultural profits for 88,000 NTD, and Coops for 44,000 NTD. In addition to being smaller than the FAs, APMGs and Coops are characterized by higher level of vertical-integration. The results therefore suggest that the formation of small in scale but highly integrated organizations such as APMGs and Coops can be a promising path to overcome the challenges confronted by the smallholder farmers in Taiwan.