Transaction costs, information technologies, and the choice of marketplace amongst farmers in northern Ghana
AbstractRelatively little evidence is available on the importance of information and the role of Information Communication Technologies (mobiles and radios) in the key aspects of marketing behaviours of developing country farmers. We included the concept of proportional and fixed transactions costs within a household framework to investigate market participation decisions of farm households with a marketable surplus of food crops. Differently to previous studies, we also modelled the behaviour of farm gale buyers. We use a novel dataset from Ghanaian farmers, which contains detailed information fro individual selling transaction that is seldom available in other household surveys. We found that larger transactions occur at the farmgale, where farmgale buyers are prepared to pay a premium price because of lower fixed transaction costs they incur. The knowledge of market information has a contrasting effect on the decision of the marketplace. In some cases, farmers use the information on prices in specific marketplaces to travel farther, in other cases they sell their commodity in closer market where they may strenghening their bargaining power. Finally we only found weak evidence on the impact of using mobile phones in reducing searching costs and attract farm gate buyers.
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Bibliographic InfoPaper provided by Agricultural Economics Society in its series 86th Annual Conference, April 16-18, 2012, Warwick University, Coventry, UK with number 134740.
Date of creation: Apr 2012
Date of revision:
market behaviour; transaction costs; information technologies; Research and Development/Tech Change/Emerging Technologies; D82; D83; D84; O12; 055;
Find related papers by JEL classification:
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
- O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
This paper has been announced in the following NEP Reports:
- NEP-AFR-2012-10-13 (Africa)
- NEP-AGR-2012-10-13 (Agricultural Economics)
- NEP-ALL-2012-10-13 (All new papers)
- NEP-DEV-2012-10-13 (Development)
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