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Farmers' satisfaction with group market arrangements as a measure of group market performance: A transaction cost analysis of Non Timber Forest Products' producer groups in Cameroon

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  • Foundjem Tita, Divine
  • D'Haese, Marijke
  • Degrande, Ann
  • Tchoundjeu, Zac
  • Van Damme, Patrick

Abstract

This paper evaluates the performance of Non Timber Forest Product (NTFP) group market initiatives by examining whether these groups meet the objectives for which they were created. Group marketing has often been cited as one way through which farmers can increase their access to markets by improving their negotiation/bargaining power and the competitiveness of their production as well as reduce transaction costs. However, these suppositions need to be verified especially as some of them are solely based on theory. This study uses data on producers' perceptions of expected benefits attainment through group sale initiatives to analyse the case of two NTFP producer groups in Cameroon. Results show that by joining groups, farmers can reduce some transaction costs while other costs may increase. Although overall negotiation power may increase following interventions from group activities, certain elements of negotiation are fundamental to success like bargaining better prices commensurate to efforts put in by members to meet quality standards set by traders. By using transaction cost theory, the study identifies certain elements hidden in the attributes of the transactions between producer groups and traders such as the nature of products and roads, or dispersed settlement of producers that may frustrate group market initiatives and may account for differences in performance between one group and another.

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  • Foundjem Tita, Divine & D'Haese, Marijke & Degrande, Ann & Tchoundjeu, Zac & Van Damme, Patrick, 2011. "Farmers' satisfaction with group market arrangements as a measure of group market performance: A transaction cost analysis of Non Timber Forest Products' producer groups in Cameroon," Forest Policy and Economics, Elsevier, vol. 13(7), pages 545-553, September.
    • Handle: RePEc:eee:forpol:v:13:y:2011:i:7:p:545-553
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    References listed on IDEAS

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    1. Yoram Barzel, 1997. "Measurement Cost and the Organization of Markets," Chapters, in: Svetozar Pejovich (ed.), The Economic Foundations of Property Rights, chapter 13, pages 171-192, Edward Elgar Publishing.
    2. Lai, Kee-hung & Cheng, T.C.E. & Yeung, A.C.L., 2005. "Relationship stability and supplier commitment to quality," International Journal of Production Economics, Elsevier, vol. 96(3), pages 397-410, June.
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    5. Buckley, Peter J & Chapman, Malcolm, 1997. "The Perception and Measurement of Transaction Costs," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 21(2), pages 127-145, March.
    6. Menard, Claude, 1995. "Markets as institutions versus organizations as markets? Disentangling some fundamental concepts," Journal of Economic Behavior & Organization, Elsevier, vol. 28(2), pages 161-182, October.
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    Cited by:

    1. Foundjem-Tita, Divine & D’Haese, Marijke & Speelman, Stjin & Degrande, Ann & Gyau, Amos & Van Damme, Patrick & Tchoundjeu, Zac & Van Huylenbroeck, Guido, 2014. "Would strictly enforced forestry regulations affect farmers’ stated intentions to plant indigenous fruits trees? Insights from Cameroon," Food Policy, Elsevier, vol. 49(P1), pages 95-106.
    2. Biao Zhang & Sang Fu, 2023. "Can Farmers’ Satisfaction with Green Production Policies Be Explained by Policy Structure and Policy Implementation? Evidence from China," Sustainability, MDPI, vol. 15(12), pages 1-19, June.
    3. Huong, Tran Thi Thu & Zeller, Manfred & Hoanh, Chu Thai, 2014. "The ‘Five Million Hectare Reforestation Program’ in Vietnam: An Analysis of its Implementation and Transaction Costs - A Case Study in Hoa Binh Province," Quarterly Journal of International Agriculture, Humboldt-Universitaat zu Berlin, vol. 53(4), pages 1-35, November.
    4. Miguel Arato & Stijn Speelman & Guido Van Huylenbroeck, 2014. "The contribution of non‐timber forest products towards sustainable rural development: The case of Candelilla wax from the Chihuahuan Desert in Mexico," Natural Resources Forum, Blackwell Publishing, vol. 38(2), pages 141-153, May.
    5. Olumeh, Dennis Etemesi & Mithöfer, Dagmar, 2023. "Gender gaps in the collection and marketing of an underutilized plant species – Baobab in Malawi," Forest Policy and Economics, Elsevier, vol. 152(C).

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