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Relational Goods and Direct Purchase from Farmers: Estimating the Value of the Relationship between Consumers and Producers




Personal relationships can affect economic life and they may be even more important in Alternative Food Networks. We estimate the value of the relational good produced by the personal relationship in direct sales by farmers. This is relevant for assessing the importance of personal interaction in a typically economic behavior like food purchase. Drawing from theoretical considerations, we employ a stated preferences methodology to estimate the value consumers buying directly from farmers attach to their particular choice of vendor. We estimated a difference-in-utility model and a model based on the valuation function, using data from a consumer survey in open-air markets in four towns in Piedmont Region (Italy). Contingent on the chosen model, the average value is 10-12 percent of the consumers’ expenditure for fruits and vegetables, and up to 1.2-1.3 percent of their overall income.
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  • Corsi, Alessandro & Novelli, Silvia, 2015. "Relational Goods and Direct Purchase from Farmers: Estimating the Value of the Relationship between Consumers and Producers," Department of Economics and Statistics Cognetti de Martiis. Working Papers 201543, University of Turin.
  • Handle: RePEc:uto:dipeco:201543

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    1. Gumirakiza, Jean Dominique & Curtis, Kynda R. & Bosworth, Ryan C., 2014. "Who Attends Farmers’ Markets and Why? Understanding Consumers and their Motivations," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 17(2), pages 1-18, May.
    2. Carroll, Kathryn A. & Bernard, John C. & Pesek, John D. Jr., 2013. "Consumer Preferences for Tomatoes: The Influence of Local, Organic, and State Program Promotions by Purchasing Venue," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 38(3), pages 1-18.
    3. Cameron, Trudy Ann, 1988. "A new paradigm for valuing non-market goods using referendum data: Maximum likelihood estimation by censored logistic regression," Journal of Environmental Economics and Management, Elsevier, vol. 15(3), pages 355-379, September.
    4. Govindasamy, Ramu & Nayga, Rodolfo M., Jr., 1997. "Determinants Of Farmer-To-Consumer Direct Market Visits By Type Of Facility: A Logit Analysis," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 26(1), pages 1-8, April.
    5. Cameron, Trudy Ann & James, Michelle D, 1987. "Efficient Estimation Methods for "Closed-ended' Contingent Valuation Surveys," The Review of Economics and Statistics, MIT Press, vol. 69(2), pages 269-276, May.
    6. Benedetto Gui & Luca Stanca, 2010. "Happiness and relational goods: well-being and interpersonal relations in the economic sphere," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 57(2), pages 105-118, June.
    7. Abello, Francisco J. & Palma, Marco A. & Anderson, David P. & Waller, Mark W., 2012. "Evaluating the Factors Influecing the Number of Visits to Farmers' Markets," 2012 Annual Meeting, February 4-7, 2012, Birmingham, Alabama 119786, Southern Agricultural Economics Association.
    8. Krinsky, Itzhak & Robb, A Leslie, 1986. "On Approximating the Statistical Properties of Elasticities," The Review of Economics and Statistics, MIT Press, vol. 68(4), pages 715-719, November.
    9. Corsi, Alessandro & Borsotto, Patrizia & Borri, Ilaria & Strom, Steinar, 2009. "Diversification of the marketing chains among organic producers," 2009 Conference, August 16-22, 2009, Beijing, China 51422, International Association of Agricultural Economists.
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    Cited by:

    1. Corsi, Alessandro & Novelli, Silvia, 2016. "The value of the participation in Solidarity Purchasing Groups (SPGs): an empirical analysis in Piedmont," 2016 Fifth AIEAA Congress, June 16-17, 2016, Bologna, Italy 242305, Italian Association of Agricultural and Applied Economics (AIEAA).
    2. Corsi, Alessandro & Novelli, Silvia, 2016. "Alternative Food Networks and short food chains: estimating the economic value of the participation in solidarity purchasing groups," 149th Seminar, October 27-28, 2016, Rennes, France 244776, European Association of Agricultural Economists.

    More about this item

    JEL classification:

    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • D1 - Microeconomics - - Household Behavior
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

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