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Contracting Institutions, Agro‐food Trade and Product Quality

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  • Jan Fałkowski
  • Daniele Curzi
  • Alessandro Olper

Abstract

The agro‐food sector has experienced a profound transformation of contractual arrangements along the value chain, coinciding with important technological innovations and product quality upgrading. Our understanding of the impact that this transformation has had on trade flows in the agricultural sector is very limited. In particular, we have limited knowledge about the extent to which the patterns in agro‐food trade have been driven by the quality of contractual institutions. Using existing measures which capture the sensitivity of agro‐food products to contractual imperfections, we show that countries with better contract enforcement specialise in the production of food which requires higher level of relationship‐specific investments. We also find that countries with better contracting institutions and producing contract‐intensive goods specialise in exporting high quality foods. In addition, we show that the quality of contracting institutions might importantly affect the process of product quality upgrading.

Suggested Citation

  • Jan Fałkowski & Daniele Curzi & Alessandro Olper, 2019. "Contracting Institutions, Agro‐food Trade and Product Quality," Journal of Agricultural Economics, Wiley Blackwell, vol. 70(3), pages 749-770, September.
    • Handle: RePEc:bla:jageco:v:70:y:2019:i:3:p:749-770
    DOI: 10.1111/1477-9552.12314
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    Cited by:

    1. Gideon Ndubuisi & Solomon Owusu, 2022. "Trust, Efficient Contracting and Export Upgrading," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(6), pages 2708-2729, December.
    2. Shi, Zhanwen & Cao, Erbao, 2020. "Contract farming problems and games under yield uncertainty," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 64(04), January.

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