Farmers' Willingness to Pay for Establishing a Collective Postharvest Refrigeration Unit: Evidence from an Eastern Mediterranean Rural Community

Amani Maalouf and Ali Chalak

Journal of Agriculture, Food Systems, and Community Development, 2019, vol. 9, issue 1

Abstract: One-third of crops harvested globally is lost due to inadequate or lack of postharvest storage facilities. This paper explores farmers’ willingness to pay (WTP) for a common refrigeration unit to reduce postharvest losses in the Bekaa valley, a Lebanese breadbasket. Using the contingent valuation (CV) method—a survey-based economic technique used mainly for the valuation of nonmarket environ­men­tal and public goods—this study was con­ducted with a sample of farmers in selected village municipalities in the area under study. The results indicate that most farmers (72%) are highly concerned about postharvest losse, and that 80% were willing to pay varying amounts for the proposed initiative, with most WTP values fall­ing within the range of US$21–US$30 per month (31%). By contrast, a consid­erable proportion of the farmers (20%) were not willing to pay any fee for establishing the common refrigeration unit. Results further establish the different small-scale farmers’ characteristics and factors affecting WTP. Some factors including longer farming experience, higher variable costs associated with farming oper­ations, working year-round in farming, and access to wholesale markets, significantly increased WTP for access to a com­mon refrigeration unit, depend­ing on the type of cultivated crops. These results are of particular interest for developing relevant policies and informing decision-making intent to solve post­harvest management issues in developing econo­mies. This study establishes the importance of offering refrigeration services at discounted or subsidized prices to smaller farmers as a public good aimed at promoting agrarian and rural development. See the press release for this article.

Keywords: Agribusiness; Institutional and Behavioral Economics (search for similar items in EconPapers)
Date: 2019
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