Farmer participation in supermarket channels and technical efficiency: The case of vegetable production in Kenya

Elizaphan J.O. Rao and Matin Qaim
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Elizaphan J.O. Rao: University of Göttingen
Matin Qaim: University of Göttingen

No 18, Courant Research Centre: Poverty, Equity and Growth - Discussion Papers from Courant Research Centre PEG

Abstract: Supermarkets and high-value exports are currently gaining ground in the agri-food systems of many developing countries. While recent research has analyzed income effects in the small farm sector, impacts on farming efficiency have hardly been studied. Using a survey of Kenyan vegetable growers and a stochastic frontier approach, we show that participation in supermarket channels increases mean technical efficiency by 19%. This gain is bigger at lower levels of efficiency, suggesting the potential for positive income distribution effects. However, disadvantaged farms often have problems in meeting strict supermarket requirements. Innovative market linkage initiatives can increase the probability of participation significantly.

Keywords: supermarkets; small farms; technical efficiency; stochastic frontier; sample selection; Kenya (search for similar items in EconPapers)
JEL-codes: D24 O12 O13 Q12 (search for similar items in EconPapers)
Date: 2009-11-25
New Economics Papers: this item is included in nep-afr, nep-agr and nep-eff
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Persistent link: https://EconPapers.repec.org/RePEc:got:gotcrc:018

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