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Food quality in domestic markets of developing economies: a comparative study of two countries

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Listed:
  • Anneleen Vandeplas
  • Bart Minten

Abstract

Food quality has become an important determinant of success in global food trade and growers for international markets have to continuously adjust to buyers’ requirements. It is however not clear to what extent there is a demand for food quality - and how much buyers are willing to pay for it - in domestic food markets of developing economies. Based on unique comparable price and trader data in a poor country in Africa (Madagascar) and an emerging economy in Asia (India), we compare food quality and quality’s pricing. We find significantly better quality and higher quality premiums (using revealed as well as stated preference methods) in India than in Madagascar. We explain these observed differences through a simple theoretical model, solely based on large average income gaps between the two countries.
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Suggested Citation

  • Anneleen Vandeplas & Bart Minten, 2015. "Food quality in domestic markets of developing economies: a comparative study of two countries," Agricultural Economics, International Association of Agricultural Economists, vol. 46(5), pages 617-628, September.
    • Handle: RePEc:bla:agecon:v:46:y:2015:i:5:p:617-628
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    File URL: http://hdl.handle.net/10.1111/agec.2015.46.issue-5
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    Cited by:

    1. Seneshaw Tamru & Bart Minten, 2023. "Value addition and farmers: Evidence from coffee in Ethiopia," PLOS ONE, Public Library of Science, vol. 18(1), pages 1-21, January.
    2. Abdoulaye, Tahirou & Adeyanju, Dolapo & Ayenan, Mathieu & Balana, Bedru & Edeh, Hyacinth & Kadjo, Didier & Liverpool-Tasie, Lenis Saweda & Olanipekun, Caleb I. & Takeshima, Hiroyuki & Yamauchi, Futosh, 2023. "Innovations for inclusive and sustainable growth of domestic food value chains: Fruits and vegetables value chains in Nigeria scoping report," CGIAR Initative Publications 9, International Food Policy Research Institute (IFPRI).
    3. Naphtal Habiyaremye & Nadhem Mtimet & Emily A. Ouma & Gideon A. Obare, 2023. "Consumers' willingness to pay for safe and quality milk: Evidence from experimental auctions in Rwanda," Agribusiness, John Wiley & Sons, Ltd., vol. 39(4), pages 1049-1074, October.
    4. Minten, Bart & Stifel, David & Tamru, Seneshaw, 2012. "Structural Transformation in Ethiopia: Evidence from Cereal Markets," ESSP research notes 14, International Food Policy Research Institute (IFPRI).
    5. Hendrik Feyaerts & Goedele Van den Broeck & Miet Maertens, 2020. "Global and local food value chains in Africa: A review," Agricultural Economics, International Association of Agricultural Economists, vol. 51(1), pages 143-157, January.
    6. Liz Ignowski & Bart Minten & Jo Swinnen & Bjorn Van Campenhout & Senne Vandevelde, 2021. "Trade, value chain technology and prices: evidence from dairy in East Africa," Working Papers of Department of Economics, Leuven 671298, KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven.
    7. Lacina Traore & Deyi Zhou & N’banan Ouattara & Lili Zhang & Kidane Assefa Abebe & Li Teng & Muhammad Rizwan, 2019. "Peasants’ Calculation Capacities and Measurement Behaviors in Rural Agricultural Markets of China and Cote d’Ivoire: Implications for Technology Adoption and Rural Development," Sustainability, MDPI, vol. 11(18), pages 1-16, September.
    8. Eunice Adu Donkor & Emmanuel Donkor & Enoch Owusu-Sekyere & Victor Owusu, 2020. "The Development and Promotion of Sweet Potato Yoghurt in Ghana: Implications for Sustainable Production and Consumption Policies," Sustainability, MDPI, vol. 12(8), pages 1-16, April.
    9. My, Nguyen H.D. & Demont, Matty & Van Loo, Ellen J. & de Guia, Annalyn & Rutsaert, Pieter & Tuan, Tran Huu & Verbeke, Wim, 2018. "What is the value of sustainably-produced rice? Consumer evidence from experimental auctions in Vietnam," Food Policy, Elsevier, vol. 79(C), pages 283-296.
    10. Bart Minten & David Stifel & Seneshaw Tamru, 2014. "Structural Transformation of Cereal Markets in Ethiopia," Journal of Development Studies, Taylor & Francis Journals, vol. 50(5), pages 611-629, May.
    11. Nkoyo Etim Bassey & Arnim Kuhn & Hugo Storm, 2018. "Are maize marketers averse to quality loss in supplies? A case study from Ghana," Agricultural Economics, International Association of Agricultural Economists, vol. 49(5), pages 649-658, September.
    12. Jianyu Yu & Olivier Bonroy & Zohra Bouamra‐Mechemache, 2023. "Quality and quantity incentives under downstream contracts: A role for agricultural cooperatives?," American Journal of Agricultural Economics, John Wiley & Sons, vol. 105(4), pages 1176-1196, August.
    13. Minten, Bart & Stifel, David & Tamru, Seneshaw, 2018. "Structural transformation of teff markets," IFPRI book chapters, in: The economics of teff: Exploring Ethiopia’s biggest cash crop, chapter 12, pages 301-325, International Food Policy Research Institute (IFPRI).
    14. Minten, Bart & Murshid, K.A.S. & Reardon, Thomas, 2013. "Food Quality Changes and Implications: Evidence from the Rice Value Chain of Bangladesh," World Development, Elsevier, vol. 42(C), pages 100-113.

    More about this item

    JEL classification:

    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality

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