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

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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. 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.

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    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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