Small Farmers and Big Retail: Trade-offs of Supplying Supermarkets in Nicaragua
In Nicaragua and elsewhere in Central America, small-scale farmers are weighing the risks of entering into contracts with supermarket chains. We use unique data from cooperatives supplying supermarkets to study the effect of supply agreements on producers’ mean output prices and price stability. We find that prices paid by the domestic retail chain approximate the traditional market in mean and variance while mean prices paid by Walmart are significantly lower than the traditional market. However, the Walmart contract is found to systematically reduce price volatility. We find some evidence, however, that farmers may be paying too much for this contractual insurance against price variation.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Johann Kirsten & Kurt Sartorius, 2002.
"Linking agribusiness and small-scale farmers in developing countries: Is there a new role for contract farming?,"
Development Southern Africa,
Taylor & Francis Journals, vol. 19(4), pages 503-529.
- Kirsten, Johann F. & Sartorius, Kurt, 2002. "Linking Agribusiness And Small-Scale Farmers In Developing Countries: Is There A New Role For Contract Farming?," Working Papers 18025, University of Pretoria, Department of Agricultural Economics, Extension and Rural Development.
- Maertens, Miet & Swinnen, Johan F.M., 2007.
"Trade, Standards and Poverty. Evidence from Senegal,"
106th Seminar, October 25-27, 2007, Montpellier, France
7924, European Association of Agricultural Economists.
- Maertens, Miet & Swinnen, Johan F.M., 2009. "Trade, Standards, and Poverty: Evidence from Senegal," World Development, Elsevier, vol. 37(1), pages 161-178, January.
- Miet Maertens & Johan F.M. Swinnen, 2006. "Trade, Standards, and Poverty: Evidence from Senegal," LICOS Discussion Papers 17706, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
- Reardon, Thomas & Barrett, Christopher B., 2000.
"Agroindustrialization, globalization, and international development: An overview of issues, patterns, and determinants,"
Blackwell, vol. 23(3), pages 195-205, September.
- Reardon, Thomas & Barrett, Christopher B., 2000. "Agroindustrialization, globalization, and international development An overview of issues, patterns, and determinants," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 23(3), September.
- Peter Gibbon, 2003. "Value-chain Governance, Public Regulation and Entry Barriers in the Global Fresh Fruit and Vegetable Chain into the EU," Development Policy Review, Overseas Development Institute, vol. 21(5-6), pages 615-625, December.
- Chavas, Jean-Paul & Holt, Matthew T, 1996. "Economic Behavior under Uncertainty: A Joint Analysis of Risk Preferences and Technology," The Review of Economics and Statistics, MIT Press, vol. 78(2), pages 329-35, May.
- Michelson, Hope & Reardon, Thomas & Perez, Francisco, 2012.
"Small Farmers and Big Retail: Trade-offs of Supplying Supermarkets in Nicaragua,"
Elsevier, vol. 40(2), pages 342-354.
- Michelson, Hope & Reardon, Thomas & Perez, Francisco Jose, 2010. "Small Farmers and Big Retail: trade-offs of supplying supermarkets in Nicaragua," Staff Papers 62124, Michigan State University, Department of Agricultural, Food, and Resource Economics.
- Atanu Saha & C. Richard Shumway & Hovav Talpaz, 1994. "Joint Estimation of Risk Preference Structure and Technology Using Expo-Power Utility," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 76(2), pages 173-184.
- Johan F. M. Swinnen & Miet Maertens, 2007.
"Globalization, privatization, and vertical coordination in food value chains in developing and transition countries,"
International Association of Agricultural Economists, vol. 37(s1), pages 89-102, December.
- Swinnen, Johan F.M. & Maertens, Miet, 2006. "Globalization, Privatization, and Vertical Coordination in Food Value Chains in Developing and Transition Countries," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25626, International Association of Agricultural Economists.
- C. Dolan & J. Humphrey, 2000. "Governance and Trade in Fresh Vegetables: The Impact of UK Supermarkets on the African Horticulture Industry," Journal of Development Studies, Taylor & Francis Journals, vol. 37(2), pages 147-176.
- Thomas Reardon & C. Peter Timmer & Christopher B. Barrett & Julio Berdegué, 2003. "The Rise of Supermarkets in Africa, Asia, and Latin America," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(5), pages 1140-1146.
- Ricardo Hernández & Thomas Reardon & Julio Berdegué, 2007. "Supermarkets, wholesalers, and tomato growers in Guatemala," Agricultural Economics, International Association of Agricultural Economists, vol. 36(3), pages 281-290, 05.
- Key, Nigel & Runsten, David, 1999. "Contract Farming, Smallholders, and Rural Development in Latin America: The Organization of Agroprocessing Firms and the Scale of Outgrower Production," World Development, Elsevier, vol. 27(2), pages 381-401, February.
- Abadie A., 2002. "Bootstrap Tests for Distributional Treatment Effects in Instrumental Variable Models," Journal of the American Statistical Association, American Statistical Association, vol. 97, pages 284-292, March.
- Bellemare, Marc F. & Barrett, Christopher B. & Just, David R., 2010. "The Welfare Impacts of Commodity Price Fluctuations: Evidence from Rural Ethiopia," MPRA Paper 24457, University Library of Munich, Germany.
- David Boselie & Spencer Henson & Dave Weatherspoon, 2003. "Supermarket Procurement Practices in Developing Countries: Redefining the Roles of the Public and Private Sectors," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(5), pages 1155-1161.
- Jose Blandon & Spencer Henson & Towhidul Islam, 2009. "Marketing preferences of small-scale farmers in the context of new agrifood systems: a stated choice model," Agribusiness, John Wiley & Sons, Ltd., vol. 25(2), pages 251-267.
When requesting a correction, please mention this item's handle: RePEc:eee:wdevel:v:40:y:2012:i:2:p:342-354. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shamier, Wendy)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.