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Transaction Costs and Farm-to-Market Linkages in China: Empirical Evidence from Apple Producers

Author

Listed:
  • Yu Wang
  • Lu Han
  • Kunda Qi
  • Jianyun Hou

Abstract

Using field surgveyed data from two apple production belts in China, this study estimates the impact of transaction costs on smallholders’ market participation and integration. The analysis is based on an innovative measurement of the transaction costs and a disaggregated analysis of sales, information, negotiation, and monitoring costs. The results reveal that farmers’ market participation levels are mainly determined by the proportional transaction costs and price, while their market integration depends on the fixed transaction costs and price. This suggests that, to lower the transaction costs and enable specialization and market participation, it is necessary to invest in and construct adequate farming infrastructure, update the rural information system, improve the structure of farmer households, and subsidize specialized rural cooperative organizations.

Suggested Citation

  • Yu Wang & Lu Han & Kunda Qi & Jianyun Hou, 2024. "Transaction Costs and Farm-to-Market Linkages in China: Empirical Evidence from Apple Producers," Journal of Agricultural Science, Canadian Center of Science and Education, vol. 12(9), pages 1-82, April.
    • Handle: RePEc:ibn:jasjnl:v:12:y:2024:i:9:p:82
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    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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