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Globalization, privatization, and vertical coordination in food value chains in developing and transition countries

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  • Johan F. M. Swinnen
  • Miet Maertens

Abstract

Food and agricultural commodity value chains in developing and transition countries have undergone tremendous changes in the past decades. Companies and property rights have been privatized, markets liberalized, and economies integrated into global food systems. The liberalization and privatization initially caused the collapse of state‐controlled vertical coordination. More recently, private vertical coordination systems have emerged and are growing rapidly as a response to consumer demand for food quality and safety on the one hand and the farms' production constraints caused by factor market imperfections. In this article we (1) demonstrate the importance of these changes, (2) discuss the implications for efficiency and equity, and (3) provide empirical evidence on the effects in several developing and transition countries.

Suggested Citation

  • Johan F. M. Swinnen & Miet Maertens, 2007. "Globalization, privatization, and vertical coordination in food value chains in developing and transition countries," Agricultural Economics, International Association of Agricultural Economists, vol. 37(s1), pages 89-102, December.
  • Handle: RePEc:bla:agecon:v:37:y:2007:i:s1:p:89-102
    DOI: 10.1111/j.1574-0862.2007.00237.x
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    References listed on IDEAS

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    1. Swinnen, Johan F.M. & Vandeplas, Anneleen, 2007. "Contracting, Competition, and Rent Distribution Theory and Empirical Evidence from Developing and Transition Countries," 103rd Seminar, April 23-25, 2007, Barcelona, Spain 9413, European Association of Agricultural Economists.
    2. Minten, Bart & Randrianarison, Lalaina & Swinnen, Johan F.M., 2009. "Global Retail Chains and Poor Farmers: Evidence from Madagascar," World Development, Elsevier, vol. 37(11), pages 1728-1741, November.
    3. Thomas Reardon & Johan F. M. Swinnen, 2004. "Agrifood Sector Liberalisation and the Rise of Supermarkets in Former State-controlled Economies: A Comparative Overview," Development Policy Review, Overseas Development Institute, vol. 22, pages 515-523, September.
    4. M. Ataman Aksoy & John C. Beghin, 2005. "Global Agricultural Trade and Developing Countries," World Bank Publications, The World Bank, number 7464.
    5. Birthal, Pratap S. & Joshi, P. K. & Gulati, Ashok, 2005. "Vertical coordination in high-value commodities," MTID discussion papers 85, International Food Policy Research Institute (IFPRI).
    6. Govereh, Jones & Jayne, T. S., 2003. "Cash cropping and food crop productivity: synergies or trade-offs?," Agricultural Economics, Blackwell, vol. 28(1), pages 39-50, January.
    7. Dries, Liesbeth & Swinnen, Johan F. M., 2004. "Foreign Direct Investment, Vertical Integration, and Local Suppliers: Evidence from the Polish Dairy Sector," World Development, Elsevier, vol. 32(9), pages 1525-1544, September.
    8. Scott Rozelle & Johan F.M. Swinnen, 2004. "Success and Failure of Reform: Insights from the Transition of Agriculture," Journal of Economic Literature, American Economic Association, vol. 42(2), pages 404-456, June.
    9. Gow, Hamish R. & Streeter, Deborah H. & Swinnen, Johan F. M., 2000. "How private contract enforcement mechanisms can succeed where public institutions fail: the case of Juhocukor a.s," Agricultural Economics, Blackwell, vol. 23(3), pages 253-265, September.
    10. Hamish R. Gow & Johan F. M. Swinnen, 2001. "Private Enforcement Capital and Contract Enforcement in Transition Economies," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(3), pages 686-690.
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