Contract farming, community effect, and farmer valuation of biofortified crop varieties in China: The case of high‐zinc wheat

Jian Li, Ping Qing, Wuyang Hu and Minglai Li

Review of Development Economics, 2022, vol. 26, issue 2, 1035-1055

Abstract: Biofortification is a feasible and cost‐efficient approach to reduce human micronutrient deficiency, but few studies have investigated its economic value from the perspective of producers. We propose an actual output‐based payment card (AOPC) method to elicit producer valuation of biofortified high‐zinc wheat in North China Plain and assess the impacts of contract farming and community network on their valuation. Unlike financial payments, AOPC uses actual output as the payment vehicle. The results show that Chinese wheat producers' valuation of the biofortified variety is featured by a dispersed and bimodal distribution. We find that contract farming positively affects farmer valuation, highlighting the role of institutional arrangement in biofortified crop planting. We also document the existence of community effects, which leads to similar valuation among farmers better connected through the shared community network. Further analysis reveals that contract farming and community network effects on producer valuation are heterogeneous between elderly and younger producers and producers with and without young children. Our findings shed new light on producer valuation of biofortified crop planting in developing countries and provide implications for advancing the process of crop biofortification to reduce global micronutrient malnutrition.

Date: 2022
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