Economic impact of farmer-driven vertical integration: the case of safe vegetable chains in northern Vietnam
2011
Wang, Huaiyu | Moustier, Paule | Thi Tan Loc, Nguyen
The paper investigates the respective profitability of contractual arrangements, direct sales and spot marketing for "safe vegetable"? farmers in northern Vietnam. It is based on a survey of 137 peri-urban vegetable farmers, with a minimum of 30 farmers in each category. Selection biases are corrected using propensity score matching methods. The results show that direct sales and contractual arrangements have a significant positive impact on income compared to spot marketing when selection biases are corrected. Contractual arrangements have less impact on income compared with the direct sales after correction of selection bias. This may be due to the still limited involvement of purchasers in the production process. The paper illustrates that direct relations between farmers and consumers, often described in literature as efficient in the development of consumer confidence in terms of quality, can indeed translate into higher income than anonymous exchange or sales under contractual arrangements with retailing companies. Some limitations of the research are given in the conclusion, along with policy recommendations. (Résumé d'auteur)
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