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Governance Structure, Perception and Innovation in Credence Food Transactions: The Role of Community Networks

Stefano Pascucci ()

No 100591, 2010 International European Forum, February 8-12, 2010, Innsbruck-Igls, Austria from International European Forum on System Dynamics and Innovation in Food Networks

Abstract: In this paper we use a combination of behavioral and new institutional economic perspectives to look at the transactions of “sustainable‐oriented” foods (e.g. organic food, fair trade, etc.) which often assume the characteristic of credence goods. When credence attributes are involved in the transaction (e.g. safety, fairness, etc.) information asymmetry and uncertainty tend to reduce the likelihood of different parties to enter in the transaction1. Because spot markets are unlikely to be used in this type of transactions, typical solutions are the use of hybrids, vertical integration and public monitoring (Vetter and Karantininis, 2002; Ménard and Valceschini, 2005). Moreover both consumers and producers (e.g. farmers) look at these products from a more utilitarian (cold) then a hedonic (hot) perspective. In this paper we address this issue by analyzing the effect of a “new” governance structure (GS) which is emerging in credence food transactions both at local and global level. We define this GS as a community network (CN) in which consumers and producers strongly integrate their goals by organizing a “club”.

Keywords: Agribusiness; Agricultural and Food Policy; Farm Management; Food Consumption/Nutrition/Food Safety; Industrial Organization; Production Economics; Research Methods/ Statistical Methods (search for similar items in EconPapers)
Pages: 14
Date: 2010-10
New Economics Papers: this item is included in nep-agr and nep-net
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Persistent link: https://EconPapers.repec.org/RePEc:ags:iefi10:100591

DOI: 10.22004/ag.econ.100591

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