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Small-Scale Vegetable Farmers’ Participation in Modern Retail Market Channels in Indonesia: The Determinants of and Effects on Their Income

Author

Listed:
  • Alim Setiawan Slamet

    () (The United Graduate School of Agricultural Science, Ehime University, Matsuyama 790-8566, Japan
    Department of Management, Faculty of Economic and Management, Bogor Agricultural University, Bogor 16680, Indonesia)

  • Akira Nakayasu

    () (Department of Resource and Environmental Policy, Faculty of Agriculture, Ehime University, Matsuyama 790-8566, Japan)

  • Masahiro Ichikawa

    () (Faculty of Agriculture, Kochi University, 200 Monobe Out, Nankoku, Kochi 783-8502, Japan)

Abstract

The rise of supermarkets in Indonesia since the end of the 1990s have been transforming the food retail sector and providing further market opportunities for small-scale farmers, in which most of Indonesia’s farmer falls into this category. The aim of this paper is to examine the supermarket participation and its effect on the well-being of small-scale farmers. We compare the differences between participants and non-participants in supermarket channels in order to explore the constraints on supermarket participation. By applying a treatment effects model which allows capturing the possibility of selection bias, we examine the factors that determine farmers’ participation as well as the effect on their income. The results show that younger farmers with higher levels of education, irrigated land, who have packaging equipment and storage facilities, and are located near paved roads, are more likely to participate in the supermarket channels. On the other hand, farmers who have sprayer equipment are more likely to participate in the traditional market channels. The effect analysis shows that small-scale farmer participation in the supermarket channels can boost their income.

Suggested Citation

  • Alim Setiawan Slamet & Akira Nakayasu & Masahiro Ichikawa, 2017. "Small-Scale Vegetable Farmers’ Participation in Modern Retail Market Channels in Indonesia: The Determinants of and Effects on Their Income," Agriculture, MDPI, Open Access Journal, vol. 7(2), pages 1-16, February.
  • Handle: RePEc:gam:jagris:v:7:y:2017:i:2:p:11-:d:89594
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    References listed on IDEAS

    as
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    Cited by:

    1. Gibson, John & Kim, Bonggeun, 2019. "Quality, quantity, and spatial variation of price: Back to the bog," Journal of Development Economics, Elsevier, vol. 137(C), pages 66-77.

    More about this item

    Keywords

    supermarket; vegetable supply chain; small-scale farmer; Indonesia;

    JEL classification:

    • Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture
    • Q10 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - General
    • Q11 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Aggregate Supply and Demand Analysis; Prices
    • 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
    • Q14 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Finance
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • Q16 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - R&D; Agricultural Technology; Biofuels; Agricultural Extension Services
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy

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