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Contractual Arrangements and Enforcement in India: The Case of Organic Basmati Paddy Farming

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  • Kumar, Shiv
  • Chandra, Subhash
  • Singh, D.R.
  • Chaudhary, Khyali R.

Abstract

The study analyses the empirical relationship between contractual arrangements and their enforcement in organic basmati paddy farming. For the purpose a list of agribusiness firms operating in Sonepat, Karnal, Kaithal and Kurukshetra districts of Haryana state were collected from the official records of their respective markets. The data on contents of contractual arrangements and their enforcement were collected from 40 agribusiness firms operating contract farming schemes in traditional basmati rice belt of the state pertaining to the year 2011-12. Binary logit model was used to capture the determinants of contract fulfilment rates. The study concludes that the provisions in designs of contract, viz., social capital, assured price in advance, bonus clause and specific investment for infrastructure creation for carrying out production and post-harvest operations in contract organic basmati scheme are likely to promote contract fulfilment rate by the farmers. Contractual arrangements are enforced through a mix of quid pro quo, altruism, and adherence to social norms.

Suggested Citation

  • Kumar, Shiv & Chandra, Subhash & Singh, D.R. & Chaudhary, Khyali R., 2013. "Contractual Arrangements and Enforcement in India: The Case of Organic Basmati Paddy Farming," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 68(3), pages 1-8.
    • Handle: RePEc:ags:inijae:206347
    DOI: 10.22004/ag.econ.206347
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    References listed on IDEAS

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    Cited by:

    1. Jing Hou & Linhai Wu & Bo Hou, 2020. "Risk Attitude, Contract Arrangements and Enforcement in Food Safety Governance: A China’s Agri-Food Supply Chain Scenario," IJERPH, MDPI, vol. 17(8), pages 1-16, April.
    2. Hou, Jing & Chen, Feiyu, 2020. "Private Enforcement Mechanisms and Contract Stability in Agri-food Supply Chain: An Empirical Evidence from China," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304586, Agricultural and Applied Economics Association.
    3. Bellemare, Marc F. & Bloem, Jeffrey R., 2018. "Does contract farming improve welfare? A review," World Development, Elsevier, vol. 112(C), pages 259-271.

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