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Excess Competition among Food Hubs

Author

Listed:
  • Cleary, Rebecca
  • Goetz, Stephan J.
  • McFadden, Dawn Thilmany
  • Ge, Houtian

Abstract

Food hubs offer a novel solution to connect small and mid-sized local farms, which individually lack the scale to profitably market their products. Because many food hubs rely on grants and philanthropy to provide services and are not necessarily profit-driven, markets may unintentionally oversaturate due to overinvestment.We use a firm-entry model to estimate the average U.S. county population necessary for one, two, and three food hubs to break even. Our findings suggest that policy makers and philanthropists need to consider the carrying capacity of the local food environment and population prior to supporting additional food hubs.

Suggested Citation

  • Cleary, Rebecca & Goetz, Stephan J. & McFadden, Dawn Thilmany & Ge, Houtian, 2019. "Excess Competition among Food Hubs," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 44(1), January.
    • Handle: RePEc:ags:jlaare:281317
    DOI: 10.22004/ag.econ.281317
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    Citations

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    Cited by:

    1. Efryta Wulan Anggraeni & Yuanita Handayati & Santi Novani, 2022. "Improving Local Food Systems through the Coordination of Agriculture Supply Chain Actors," Sustainability, MDPI, vol. 14(6), pages 1-19, March.
    2. Ge, Houtian & Goetz, Stephan J. & Cleary, Rebecca & Yi, Jing & Gómez, Miguel I., 2022. "Facility locations in the fresh produce supply chain: An integration of optimization and empirical methods," International Journal of Production Economics, Elsevier, vol. 249(C).
    3. Bonanno, Alessandro & Mendis, Sachintha S., 2021. "Too cool for farm to school? Analyzing the determinants of farm to school programming continuation," Food Policy, Elsevier, vol. 102(C).
    4. Mejía, Gonzalo & Aránguiz, Raúl & Espejo-Díaz, Julián Alberto & Granados-Rivera, Daniela & Mejía-Argueta, Christopher, 2023. "Can street markets be a sustainable strategy to mitigate food insecurity in emerging countries? Insights from a competitive facility location model," Socio-Economic Planning Sciences, Elsevier, vol. 86(C).
    5. Houtian Ge & Miguel I. Gómez & Timothy J. Richards, 2024. "The effect of price and assortment of local products on store performance: An agent‐based modelling approach," Journal of Agricultural Economics, Wiley Blackwell, vol. 75(3), pages 981-1003, September.
    6. Houtian Ge & Miguel Gómez & Christian Peters, 2022. "Modeling and optimizing the beef supply chain in the Northeastern U.S," Agricultural Economics, International Association of Agricultural Economists, vol. 53(5), pages 702-718, September.
    7. Rebecca Cleary & Lauren Chenarides, 2022. "Food retail profits, competition, and the Great Recession," Agribusiness, John Wiley & Sons, Ltd., vol. 38(3), pages 557-578, July.

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